The government has ruled out any reduction in subsidies on fertilisers in the country. Minister of State for Chemicals and Fertilisers Bhagwanth Khuba said there is no proposal to reduce subsidy on fertilisers. He stated this in a written reply in the Lok Sabha in Friday.
Khuba said, "No such study to understand the impact of reducing fertiliser subsidy on farmers has been conducted so far." To a separate question, he said the government at present has no plan to control the rates of P&K fertilisers under the Nutrient Based Subsidy (NBS) scheme. The government provides subsidy on both urea and non-urea fertilisers to ensure farmers get the soil nutrients at affordable rates.
With regard to urea fertiliser, the minister said it is provided to farmers at a statutorily notified maximum retail price of Rs 242 per bag of 45 kg (exclusive of charges towards neem coating and taxes as applicable). The difference between the delivered cost of urea at farm gate and net market realisation by the urea units is given as subsidy to the urea manufacturers/importer by the central government.
"Accordingly, all farmers are being supplied urea at subsidized rates," he said. In case of phosphate (P) and potassic (K) fertilisers, subsidy is fixed under the Nutrient Based Subsidy (NBS) by an inter-ministerial committee taking into account the benchmark international prices of finished fertilisers as well as raw materials.
The subsidy is given to registered to P&K fertiliser manufacturers/importers which provides these fertilisers at subsidised rates to farmers. The subsidy for P&K fertilisers is estimated to be Rs 42,000 crore for the 2022-23 fiscal.