The Cabinet Committee on Economic Affairs, chaired by Prime Minister Narendra Modi has approved the proposal of the Department of Fertilizers for fixation of nutrient based subsidy (NBS) rates for P&K fertilisers for the year 2021-22 (till the present season). The approved rates for fertiliser subsidy under NBS effective from the date of notification shall be as under:
| Per Kg subsidy rates (in Rs.) | |||
| N (Nitrogen) | P (Phosphorus) | K (Potash) | S (Sulphur) |
| 18.789 | 45.323 | 10.116 | 2.374 |
Government of India is making available fertilisers, namely urea and 22 grades of P&K fertilisers (including DAP) to farmers at subsidised prices through fertiliser manufacturers and importers. The subsidy on P&K fertilisers is being governed by NBS scheme w.e.f. April 01, 2010. In accordance to its farmer friendly approach, the Government ensures the availability of P&K fertilisers to the farmers at affordable prices. The subsidy is released to fertiliser companies as per NBS rates so that they can make available fertilisers to farmers at affordable price.
In last few months, the international prices of raw materials of DAP (Diammonium phosphate) and other P&K fertilisers have increased sharply. Prices of finished DAP in international market have also increased. Despite this sharp increase, DAP prices in India were initially not increased by the companies however, some companies increased the DAP price in the beginning of this financial year.
Government is already taking steps to tackle the situation so that farming community can be saved from the effects of this price rise of P&K fertilisers (including DAP). Accordingly, as a first step, Government has already directed all the fertiliser companies to ensure the sufficient availability of these fertilisers in the market for farmers. Availability of fertilisers in the country is being monitored by the Government.
On the pricing front of DAP, Government has already asked all the fertiliser companies to sell their old stocks at the old prices only. Considering the crisis of pricing of DAP in India as an extraordinary situation and distress for the farmers, Gol has increased the subsidy rates under NBS scheme as a special package for farmers in such a way that MRP of DAP (including other P&K fertilisers) can be kept at the last year’s level till the present Kharif season. This has been done as one-time measure as Covid -19 package to reduce the hardships of farmers. As anticipated that international prices may come down in few months, Gol may review the situation accordingly and decide regarding subsidy rates at that point of time. The estimated additional subsidy burden for such an arrangement will be around Rs 14,775 crore.
