Lok Sabha Question No. 3173 (UNSTARRED), answered on 2024-08-09
Subject: Increase in Prices of Fertilizers
Ministry: CHEMICALS AND FERTILIZERS
Asked by: Shri Sachithanantham R

## GOVERNMENT OF INDIA MINISTRY OF CHEMICALS AND FERTILIZERS DEPARTMENT OF FERTILIZERS

## LOK SABHA

UNSTARRED QUESTION NO. 3173 TO BE ANSWERED ON : 09.08.2024

## INCREASE IN PRICES OF FERTILIZERS

3173.  SHRI SACHITHANANTHAM R:

Will the Minister of CHEMICALS AND FERTILIZERS be pleased to state:

- (a) whether  the  Government  is  aware  of  the  fact  that  the  price  of  fertilizers  are increasing steadily every year due to which many farmers across the country are facing severe financial difficulties and unable to afford to purchase fertilizers for their cultivation;
- (b) if so, the details thereof;
- (c) whether the Government has any proposal to waive-off/cut/reduce GST on all kind of fertilizers which are essential for cultivation; and
- (d) if so, the details thereof and if not, the reasons therefor?

## ANSWER

THE MINISTER OF STATE IN THE MINISTRY OF CHEMICALS & FERTILIZERS (SMT. ANUPRIYA PATEL)

(a) & (b): For Phosphatic and Potassic (P&K) Fertilizers, Government has implemented Nutrient Based Subsidy Policy w.e.f. 1.4.2010.  Under the policy, a fixed amount  of  subsidy,  decided  on  annual/bi-annual  basis  -  based  on  import  prices  of fertilizers  and  other  relevant  factors  like  requirement  of  nutrients  in  the  country, balanced  use  of  fertilizers,  subsidy  and  MRP  etc  - is  provided  on  P&K  fertilizers depending on their nutrient content.

Under the NBS regime, MRP of P&K fertilizers has been left open and fertilizer manufacturers/marketers are allowed to fix the MRP at reasonable rates. Thus, the market  price  of  decontrolled  subsidized  fertilizers  is  determined  based  on  demandsupply. The fertilizers companies are required to print retail price along with subsidy on the bags. The average MRP of major P&K fertilizers viz., DAP, MOP, SSP, NPK 12-32-16,  NPK  10-26-26  and  NPK  20-20-0-13  for  last  05  years  are  placed  at Annexure.

In case of Urea, it is provided to the farmers at a statutorily notified Maximum Retail  Price (MRP). The MRP of 45 kg bag of urea  is Rs.242 per bag (exclusive of charges towards neem coating and taxes as applicable) and the MRP has remained unchanged since 01.03.2018 to till date. The difference between the delivered cost of urea at              farm gate and net market realization by  the urea units is given as subsidy to the urea manufacturer/importer by the Government of India. Accordingly, all farmers are being supplied urea at the subsidized rates.

(c) & (d): GST rates are prescribed on the recommendations of GST Council, which is a constitutional body comprising of representatives from States/UTs and Centre.

The GST Council in its 53 rd meeting held on 22nd June, 2024, has referred the matter to Group of Ministers on Rate Rationalization for a holistic view.

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## Annexure

## Annexure referred to in reply to part (a) & (b) of Lok Sabha Untarred Question No. 3173 for answering on 09.08.2024

| S. No   | NPK Fertilizer Grade   | Average MRP (approx.) (in Rs./MT)   | Average MRP (approx.) (in Rs./MT)   | Average MRP (approx.) (in Rs./MT)   | Average MRP (approx.) (in Rs./MT)   | Average MRP (approx.) (in Rs./MT)   | Average MRP (approx.) (in Rs./MT)   |
|---------|------------------------|-------------------------------------|-------------------------------------|-------------------------------------|-------------------------------------|-------------------------------------|-------------------------------------|
|         |                        | 2019-20                             | 2020-21                             | 2021-22                             | 2022-23                             | 2023-24                             | 2024-25 (as on 24.07.2024)          |
| 1       | DAP (18-46-0-0)        | 26518.28                            | 24966.78                            | 25003.55                            | 26939.94                            | 27000                               | 27000                               |
| 2       | MOP (0-0-60-0)         | 18981.04                            | 17872.63                            | 23338.42                            | 34147.54                            | 33987.88                            | 32249.56                            |
| 3       | SSP (0-16-0-11)        | 7848.25                             | 8032.04                             | 7294.57                             | 10035.50                            | 10628.23                            | 10338.47                            |
| 4       | NPK 10-26-26           | 25750.94                            | 24575.66                            | 29751.24                            | 29760.78                            | 29394.92                            | 29707.50                            |
| 5       | NPK 12-32-16           | 25734.16                            | 24643.11                            | 28733.24                            | 31562.41                            | 29865.16                            | 29400                               |
| 6       | NPK 20-20-0-13         | 20707.05                            | 19938.68                            | 24652.55                            | 28045.64                            | 25275.63                            | 25423.77                            |

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