The Centre has “doubled” the fertiliser subsidy for this rabi season in light of the sharp increase in fertiliser prices on the international market. In a meeting held here on Wednesday, the Union Cabinet authorised a subsidy for phosphoric and potassium fertilisers (P&K) for the current rabi season in the amount of 51,875 crores for nitrogen (N), phosphorus (P), potash (K), and sulphur (S).
The amount of the nutrient-based subsidy has more than doubled from the budget estimate of 21,000 crore, according to Mansukh Mandaviya, the union minister for fertilisers and chemicals. After the meeting, he gave a press conference and said that the Center has changed the subsidy to take into account the rising market pricing.
“This is the highest subsidy so far. Last year it was ₹1.65 lakh crore,” Mr. Mandaviya said and added that as commercial prices had doubled due to the Ukraine-Russia conflict and the logistics issues due to pandemic the Centre decided to double the subsidy component too. “Increased prices would have burdened the farmers. We have ensured that there will not be any increase in the fertilizer prices in the next six months,”
According to Mr. Mandaviya, a bag of diammonium phosphate cost $1,350, but without the subsidy, it would have cost $2,650. He claimed that the subsidy for urea was roughly $2,400 per bag because a bag was being sold for about $266 as opposed to the market price of $2,700.
He continued by saying that the Center had initiated steps to boost urea output in the nation. The country produced 250 lakh metric tonnes (LMT), compared to the 350 lakh LMT required. He stated that four more facilities will soon be built and that nano-urea would gradually replace the use of urea. According to Mr. Mandaviya, rumours of farmers standing in line to buy fertiliser were exaggerated and the nation had ample fertiliser supplies for this season.
“This will enable smooth availability of all P&K fertilizers to the farmers during rabi 2022-23 at the subsidised / affordable prices and support the agriculture sector. The volatility in the international prices of fertilizers and raw materials has been primarily absorbed by the Union government,”