Lok Sabha Question No. 5575 (UNSTARRED), answered on 2026-03-27
Subject: Rationalisation of Fertilizer Subsidy
Ministry: CHEMICALS AND FERTILIZERS
Asked by: Prof. Sougata Ray, Shri Kishori Lal

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

## LOK SABHA

## UNSTARRED QUESTION NO. 5575 TO BE ANSWERED ON : 27.03.2026 Rationalization of Fertilizer Subsidy

## 5575.  PROF. SOUGATA RAY: SHRI KISHORI LAL:

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

- (a) whether the Government has increased the subsidy on fertilizers in view of rising global prices of raw materials, if so, the details thereof; and
- (b) whether  the  Government  proposes  to  rationalize  fertilizer  subsidy  to ensure benefits reach small and marginal farmers?

## ANSWER

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

(a) to (b): Urea is provided to the farmers at a statutorily notified Maximum Retail Price (MRP) irrespective of the cost of production. The subsidized MRP of 45 kg bag of urea is Rs.242 per bag (exclusive of charges towards neem coating and taxes 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  are  being  supplied  urea  at  the subsidized rates.

In case of Phosphatic and Potassic (P&K) fertilizers,  Government  has implemented  Nutrient  Based  Subsidy  (NBS)  Policy  w.e.f.  01.04.2010.  Under  the policy, a fixed amount of subsidy, decided on annual/bi-annual basis, is provided to manufacturer  /  importer  on  subsidized  P&K  fertilizers  depending  on  their  nutrient content  i.e.  Nitrogen  (N),  Phosphorus  (P),  Potassium  (K)  and  Sulphur  (S).  The Government  monitors  international  prices  of  key  fertilizers  and  raw  materials  and fluctuations, if any, are subsumed while fixing NBS rates for P&K fertilizers to ensure

affordable  supply  of  P&K  fertilizers  to  the  farmers.  Further,  to  ensure  affordability, special provisions like Rs. 3500 per MT to cover 'Other Costs' which includes costs incurred from factory gate to farm gate, advantage / disadvantage due to increase / decrease in international prices, provision for GST component included in the MRP and  provision  for  reasonable  return  @  4%  of  net  MRP  (MRP-GST)  have  been extended to both imported and domestic DAP and imported TSP over and above NBS subsidy  for  Kharif  2025  and  Rabi  2025-26  seasons.  The  NBS  policy  is  uniformly applicable across the  country and fertilizers  at subsidized rates  are provided to all buyers including small  and  marginal  farmers.  Details  of  nutrient  wise  NBS  subsidy rates for last four seasons are attached as Annexure.

Further,  the  Government  has  implemented  Direct  Benefit  Transfer (DBT)  in Fertilizers across all States/UTs with effect from March, 2018. Under the DBT system, the  sale  of  subsidized  fertilizers  to  the  buyer  is  done  on  the  basis  of  Aadhaar authentication of through Point of Sale (PoS) devices installed at Fertilizers retail shop. The subsidy is paid to the Fertilizers Companies on weekly basis on the basis of PoS sale. This is to ensure that the benefit of subsidized fertilizers reached to all farmers across the nation including small and marginal farmers.

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## Annexure

## Annexure referred to in reply to parts (a) to (b) of Lok Sabha Unstarred Question no. 5575 for answering on 27.03.2026

## Details of nutrient wise NBS subsidy rates

(in Rs. Per  Kg)

| Nutrients   | 2024-25 Kharif   |   2024-25 Rabi |   2025 Kharif | 2025-26 Rabi   |
|-------------|------------------|----------------|---------------|----------------|
| N 47.02     |                  |          43.02 |         43.02 | 43.02          |
| P 28.72     |                  |          30.8  |         43.6  | 47.96          |
| 2.38        |                  |           2.38 |          2.38 | K 2.38         |
| S 1.89      |                  |           1.76 |          2.61 | 2.87           |