evidence: Jat and Pal, 2002). In March 2015, the government of India made it mandatory for fertilizer producers to produce NCU up to 70% of capacity and finally in May 2015 directed to manufacture full capacity. This decision was motivated not only by the better performance of NCU vis-à-vis prilled urea in terms of paddy production, but also by an expectation that it will cut down the consumption of urea for paddy cultivation. With NCU already being supplied to farmers as fertilizer N in India, it is not yet clear as to what extent it will lead to increased paddy production and/or reduced demand for urea. Therefore, research investigations based on scientifically-sound experiments and published in peer-reviewed journals have been critically analyzed to better understand the agronomic benefits of neem coated urea vis-à-vis prilled urea. [...] However, subsidized urea is diverted towards other industries like chemical industry, automobile systems and laboratories. This often leads to a shortage of urea for the intended beneficiary of the subsidy i.e. the farmer. Government of India has taken measures to control the black marketing of Urea, through a new policy of promoting neem coated urea. Indigenous manufacturers of urea have to mandatorily produce 75% of the subsidized urea as neem coated urea. Further, they are free to produce the whole amount of subsidized urea as NCU. NCU is not only environment friendly but it also prevents the usage of urea for non agricultural purposes.