Lok Sabha Question No. 4660 (UNSTARRED), answered on 2026-03-20
Subject: Allocation of Fertilizer Subsidy
Ministry: CHEMICALS AND FERTILIZERS
Asked by: Shri Kali Charan Singh

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

## LOK SABHA

## UNSTARRED QUESTION NO. 4660 TO BE ANSWERED ON 20.03.2026

## Allocation of Fertilizer Subsidy

## 4660: Shri Kali Charan Singh:

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

- (a) the impact of Neem Coated Urea policy on diversion;
- (b) whether  POS-based  sales  monitoring  has  reduced  leakages,  if  so  the  details thereof and the action taken against erring dealers;
- (c) the total fertiliser subsidy allocated, released and utilised during the last three years and the current year, year-wise;
- (d) whether  any  subsidy  dues  are  pending  to  fertiliser  companies,  and  if  so,  the details thereof;
- (e) whether delays in subsidy payments have affected production/supply; and
- (f)  if so, the details thereof along with the corrective measures taken to ensure timely settlement of claims?

## ANSWER

THE MINISTER OF STATE IN THE MINISTRY OF CHEMICALS & FERTILIZERS

## (SMT. ANUPRIYA PATEL)

(a) and (b): The primary purpose of neem coated urea is to enhance the efficiency of nitrogen utilization in agriculture. By coating urea with neem oil, which contains natural nitrification inhibitors, the release of nitrogen is slowed down, making it available to plants over a longer period. This slow-release feature helps to reduce nitrogen leaching into the soil, which can lead to water and soil contamination. The use of neem coated urea has been beneficial in improving soil health, reducing pest and disease attacks, and increasing nitrogen use efficiency. In 2017, Department of Agriculture, & Farmers Welfare (DA&FW) conducted a study to determine the impact of Neem Coated Urea through Agricultural Development  and  Rural Transformation  Centre  (ADRTC), Bengaluru which inter-alia found that diversion of highly subsidized urea towards nonagricultural purposes negligible among farmers after the introduction of the mandatory policy of production and distribution of only Neem Coated Urea . Further, in order to address the issues such as diversion, hoarding and black-marketing, fertilizers  are declared as an essential commodity under the Essential Commodities Act, 1955 and notified under Fertilizer Control Order, 1985. State Governments are empowered to take action against persons involved in said malpractices, as per provisions of EC Act. Any complaints received at Department of Fertilizers level regarding these malpractices is also sent to concerned State Government to take appropriate action under Essential Commodities Act, 1955 and Fertilizer Control Order, 1985. However, Department  of  Agriculture  and  Farmers  Welfare  (DA&FW)  in  consultation  with  the State  Governments  is  regularly  monitoring  the  enforcement  action  taken  by  State Governments  against  the  cases  of  Black  marketing,  Hoarding,  Sub-standard  and Diversion on weekly basis.

There is a ceiling of 50 bags per buyer per month on PoS based sale of subsidized fertilizers and any suspicious sale through PoS machine, beyond official hours is also being monitored by the respective State Government officials. Furthermore, at the time of  biometric  authentication,  the  season  wise,  month  wise  purchase  made  by  the Farmer is reflected on the PoS screen for awareness of the Farmer and the retailer. Under  FCO,  1985,  the  State  Government  is  empowered  to  take  necessary  action against erring dealers to prevent leakages.

(c): The details of the total amount of fertilizer subsidy allocated and disbursed by the Government during the last three years 2022-23 to 2024-25 and the current financial year (as on 17.03.2026) are as follows:

|                |                                        | (Rs. In Crores)   | (Rs. In Crores)   |
|----------------|----------------------------------------|-------------------|-------------------|
| Financial Year | Component                              | Allocation        | Expenditure       |
| 2022-23        | Phosphatic & Potassic (P&K)            | 86,122.00         | 86,122.00         |
| 2022-23        | Urea                                   | 1,68,677.00       | 1,68,677.00       |
| 2022-23        | Promotion of Organic Fertilizers (MDA) | --                | --                |
| 2022-23        | Total                                  | 2,54,799.00       | 2,54,799.00       |
| 2023-24        | Phosphatic & Potassic (P&K)            | 65,200.00         | 65,200.00         |
| 2023-24        | Urea                                   | 1,30,221.00       | 1,30,221.00       |
| 2023-24        | Promotion of Organic Fertilizers (MDA) | 5.00              |                   |
| 2023-24        | Total                                  | 1,95,426.00       | 1,95,421.00       |
| 2024-25        | Phosphatic & Potassic (P&K)            | 52,810.00         | 52,810.00         |
| 2024-25        | Urea                                   | 1,24,319.50       | 1,24,319.50       |
| 2024-25        | Promotion of Organic Fertilizers (MDA) | 28.00             | 28.00             |
| 2024-25        | Total                                  | 1,77,157.50       | 1,77,157.50       |

|                       | Phosphatic & Potassic (P&K)            | 60,000 (RE)      | 59,967.98 (as on 17.03.2026)   |
|-----------------------|----------------------------------------|------------------|--------------------------------|
| 2025-26 (source: PAO) | Urea                                   | 1,41,961.50 (RE) | 1,32,889.78 (as on 17.03.2026) |
|                       | Promotion of Organic Fertilizers (MDA) | 100 (RE)         | 88.30 (as on17.03.2026)        |
|                       | Total                                  | 2,02,061.50      | 1,92,946.06 (as on 17.03.2026) |

- (d)  to  (f) :  The  subsidy  payable  to  individual  fertilizer  companies  under  the  various subsidy schemes of Department of Fertilizers is disbursed through an online system. All the Fertilizer sale transactions are captured online in the Integrated Fertilizer Management System (iFMS) system on real time basis. The claims are processed on a weekly basis and the amount of subsidy is  remitted  to the company's bank account through electronic mode based on the actual sales made through PoS machines. The payment of bills is processed on 'First in First out (FIFO)' principle in the sequence of the receipt of same based on duly completed bills received in the Department. It is a dynamic  process.  Further,  claims  raised  by  the  companies  are  also  sent  back  for corrections and modifications following laid down provisions resulting in accumulation of pending claims. The Department is responsible for payment of bills only when bills, duly completed in all respects, are generated by the Fertilizer companies. Incomplete claims are not accepted. Whenever any shortage of funds is noticed, the Department immediately makes all the possible efforts to get additional funds under supplementary grants or revised estimates as per procedure.

Further,  the  availability  of  fertilizers  viz.  Urea,  DAP,  MOP  and  NPK  has  remained adequate in the country during the last three FYs i.e. 2022-23, 2023-24 and 2024-25 and  current  year  (2025-26).  The  information  regarding  requirement,  availability  and sales of these fertilizers during the said period is placed at Annexure.

***

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## Annexure

ANNEXURE referred to in reply to the part ( d ) to (f) of Lok Sabha Unstarred Question No. 4660 for answering on 20.03.2026.

| ALL INDIA                                                                                  | ALL INDIA                                                                                  | ALL INDIA                                                                                  | ALL INDIA                                                                                  | ALL INDIA                                                                                  | ALL INDIA                                                                                  | ALL INDIA                                                                                  | ALL INDIA                                                                                  | ALL INDIA                                                                                  | ALL INDIA                                                                                  | ALL INDIA                                                                                  | ALL INDIA                                                                                  | ALL INDIA                                                                                  | ALL INDIA   |
|--------------------------------------------------------------------------------------------|--------------------------------------------------------------------------------------------|--------------------------------------------------------------------------------------------|--------------------------------------------------------------------------------------------|--------------------------------------------------------------------------------------------|--------------------------------------------------------------------------------------------|--------------------------------------------------------------------------------------------|--------------------------------------------------------------------------------------------|--------------------------------------------------------------------------------------------|--------------------------------------------------------------------------------------------|--------------------------------------------------------------------------------------------|--------------------------------------------------------------------------------------------|--------------------------------------------------------------------------------------------|-------------|
| REQUIREMENT, AVAILABILITY & SALES OF FERTILIZERS DURING 2022-23 to 2025-26 (Till 16.03.26) | REQUIREMENT, AVAILABILITY & SALES OF FERTILIZERS DURING 2022-23 to 2025-26 (Till 16.03.26) | REQUIREMENT, AVAILABILITY & SALES OF FERTILIZERS DURING 2022-23 to 2025-26 (Till 16.03.26) | REQUIREMENT, AVAILABILITY & SALES OF FERTILIZERS DURING 2022-23 to 2025-26 (Till 16.03.26) | REQUIREMENT, AVAILABILITY & SALES OF FERTILIZERS DURING 2022-23 to 2025-26 (Till 16.03.26) | REQUIREMENT, AVAILABILITY & SALES OF FERTILIZERS DURING 2022-23 to 2025-26 (Till 16.03.26) | REQUIREMENT, AVAILABILITY & SALES OF FERTILIZERS DURING 2022-23 to 2025-26 (Till 16.03.26) | REQUIREMENT, AVAILABILITY & SALES OF FERTILIZERS DURING 2022-23 to 2025-26 (Till 16.03.26) | REQUIREMENT, AVAILABILITY & SALES OF FERTILIZERS DURING 2022-23 to 2025-26 (Till 16.03.26) | REQUIREMENT, AVAILABILITY & SALES OF FERTILIZERS DURING 2022-23 to 2025-26 (Till 16.03.26) | REQUIREMENT, AVAILABILITY & SALES OF FERTILIZERS DURING 2022-23 to 2025-26 (Till 16.03.26) | REQUIREMENT, AVAILABILITY & SALES OF FERTILIZERS DURING 2022-23 to 2025-26 (Till 16.03.26) | REQUIREMENT, AVAILABILITY & SALES OF FERTILIZERS DURING 2022-23 to 2025-26 (Till 16.03.26) | Fig. inLMT  |
| S.No                                                                                       |                                                                                            | UREA                                                                                       | UREA                                                                                       | UREA                                                                                       | DAP                                                                                        | DAP                                                                                        | DAP                                                                                        | MOP                                                                                        | MOP                                                                                        | MOP                                                                                        | NPKS                                                                                       | NPKS                                                                                       | NPKS        |
|                                                                                            | State                                                                                      | Requirement                                                                                | Availability                                                                               | DBT Sales                                                                                  | Requirement                                                                                | Availability                                                                               | DBT Sales                                                                                  | Requirement                                                                                | Availability                                                                               | DBT Sales                                                                                  | Requirement                                                                                | Availability                                                                               | DBT Sales   |
| 1                                                                                          | 2025-26 (Till 16.03.26)                                                                    | 374.22                                                                                     | 438.22                                                                                     | 386.09                                                                                     | 109.23                                                                                     | 120.15                                                                                     | 98.20                                                                                      | 25.95                                                                                      | 29.61                                                                                      | 21.69                                                                                      | 155.08                                                                                     | 193.99                                                                                     | 146.66      |
| 2                                                                                          | 2024-25                                                                                    | 364.01                                                                                     | 443.83                                                                                     | 387.92                                                                                     | 111.92                                                                                     | 105.14                                                                                     | 96.29                                                                                      | 22.21                                                                                      | 30.85                                                                                      | 22.02                                                                                      | 151.29                                                                                     | 183.98                                                                                     | 149.72      |
| 3                                                                                          | 2023-24                                                                                    | 356.08                                                                                     | 437.47                                                                                     | 357.81                                                                                     | 110.18                                                                                     | 127.42                                                                                     | 109.73                                                                                     | 27.62                                                                                      | 22.74                                                                                      | 16.45                                                                                      | 126.31                                                                                     | 156.51                                                                                     | 116.80      |
| 4                                                                                          | 2022-23                                                                                    | 359.19                                                                                     | 415.82                                                                                     | 357.26                                                                                     | 114.20                                                                                     | 130.93                                                                                     | 105.31                                                                                     | 34.17                                                                                      | 19.55                                                                                      | 16.32                                                                                      | 120.69                                                                                     | 138.15                                                                                     | 107.31      |