Lok Sabha Question No. 3762 (UNSTARRED), answered on 2023-08-11
Subject: Fertilizer Subsidy Policy
Ministry: CHEMICALS AND FERTILIZERS
Asked by: Hasmukhbhai Somabhai Patel, Ratansinh Magansinh Rathod

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

## LOK SABHA

## UNSTARRED QUESTION NO. 3762 TO BE ANSWERED ON: 11.08.2023

## Fertilizer Subsidy Policy

3762:  SHRI  PATEL HASMUKHBHAI SOMABHAI:

SHRI  RATANSINH MAGANSINH RATHOD:

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

- (a) whether  the  Fertilizer  Subsidy  Policy  and  Pricing  matters  including  need  to continue Urea Subsidy Scheme has been implemented across the country;
- (b) if so, the details thereof; and
- (c) the details of beneficiaries of such scheme in the State of Gujarat, district wise?

## ANSWER

## MINISTER OF STATE FOR CHEMICALS & FERTILIZERS

(SHRI BHAGWANTH KHUBA)

- (a)  to (c):     The Cabinet Committee on Economic Affairs (CCEA) on 28 th June, 2023 approved a unique package of innovative schemes for farmers with a total outlay of Rs. 3,70,128.54 crore.

The  package  includes  the  Continuation  of  the  existing  urea  subsidy  scheme upto  31 st March,  2025  (FY  2022-23  to  2024-25)  at  a  total  estimated  outlay  of  Rs 3,68,676.70 crore (the actual expenditure may vary based on the prices of natural gas and other inputs used for the production of Urea).

Under  the  Urea  Subsidy  Scheme,  Urea  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). 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  (including  farmers  of  Gujarat)  are beneficiaries of this scheme and are being supplied urea at the subsidized rates.

The  CCEA  in  its  above-mentioned  meeting  has  also  approved  the  'PM Programme for Restoration, Awareness Generation, Nourishment, and Amelioration of Mother-Earth (PM-PRANAM)'. The initiative aims to support the mass movement started by States/UTs to save the health of Mother Earth by promoting sustainable and  balanced  use  of  fertilizers,  adopting  alternate  fertilizers,  promoting  organic farming  and  implementing  resource  conservation  technologies.  Under  the  said scheme, 50% of the fertilizer  subsidy  saved  by  a  State/UT  in  a  particular  financial year  by  way  of  reduction  in  consumption  of  chemical  fertilizers  (Urea,  DAP,  NPK, MOP) compared to previous 3 years' average consumption, will be passed on to that State/UT as Grant.

Further,  the  CCEA  has  also  approved  the  Market  Development  Assistance (MDA) @ Rs. 1500/MT to promote organic fertilizers, i.e., manure produced at plants under GOBARdhan initiative covering different Biogas/CBG support schemes/programmes  of  stakeholder  Ministries/Departments  such  as  Sustainable Alternative Towards Affordable Transportation (SATAT) scheme of MoPNG, 'Waste to Energy' programme of MNRE, Swachh Bharat Mission (Rural) of DDWS, etc. with total outlay of Rs. 1451.84 Crore (FY 2023-24 to 2025-26), which includes a corpus of Rs. 360 Crore for research gap funding, etc.

Further,Government  has  implemented  Nutrient  Based  Subsidy  Policy  w.e.f. 01.04.2010  all  over  the  country.  As  per  Cabinet's  approval  dated  19.01.2022  the scheme is to continue till2025-26.

Under  the  NBS  Policy,  a  fixed  rate  of  subsidy  (in  Rs.  per  Kg  basis)  is announced on nutrients namely Nitrogen (N), Phosphate (P), Potash (K) and Sulphur (S) by the Government on annual/bi-annual basis. The per kg subsidy rates on the nutrient N, P, K, S is converted into per Tonne subsidy on the various P&K fertilizers covered under NBS Policy. Any variant of the fertilizers covered under the subsidy scheme  with  micronutrients  namely  Boron  and  Zinc,  is  eligible  for  a  separate  per tonne subsidy to encourage their application along with primary nutrients.

At  present  25  grades  of  P&K  fertilizers  namely  DAP,  MAP,  TSP,  MOP, Ammonium Sulphate, SSP, PDM and 18 grades of NPKS complex fertilizers are covered under the NBS Policy.

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.

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