‘No proposal to reduce subsidy on fertilisers’

New Delhi: The government on Friday said that there is no proposal to reduce subsidies on fertilisers in the country.

Minister of State for Chemicals and Fertilisers Bhagwanth Khuba, in his written reply to the Lok Sabha, said, “No such study to understand the impact of reducing fertiliser subsidy on farmers has been conducted so far.”

In a separate reply, the minister 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 urea 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 added.

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.

Moreover, India imported 34.19 lakh tonnes of fertilisers, including urea and DAP, from Russia during April-February of the current fiscal, highest in the last three years, according to the data placed before Parliament.

The imports have risen notwithstanding the Russia-Ukraine war.

“....import of urea in the current year up to February (during the ongoing Ukraine war) is more than double as compared to the previous year,” Minister of State for Fertilisers Bhagwanth Khuba said in his written reply to the Lok Sabha.

Out of total fertiliser import of 34.19 lakh tonnes, about 6.26 lakh tonnes of urea was imported till February of the ongoing 2022-23 financial year, as against 2.80 lakh tonnes imported during the entire previous fiscal, he said.

Apart from urea, Di-Ammonium Phosphate (DAP), Muriate of Potash (MoP) and NPK were the other fertilisers imported from Russia.

DAP imports stood at 7.65 lakh tonnes, MoP at 0.43 lakh tonnes and NPK at 19.85 lakh tonnes during April-February period of the current fiscal, the data showed.

Total fertiliser imports from Russia were at 19.15 lakh tonnes during the 2021-22 fiscal, 19.15 lakh tonnes during the financial year 2020-21 and 11.91 lakh tonnes in 2019-20 fiscal year.

Urea and DAP are two largely consumed fertilisers in the country. The minister said that the government has taken several measures to boost the domestic urea production. Six new urea units have been set up under the New Investment Policy. In a separate reply, he said the availability of fertilisers has remained comfortable in the country during the 2022-23 rabi season. The gap between demand and production of urea and other fertiliser is met through imports. “The imports are planned well in advance to ensure timely availability,” he added.