The Business Bytes
New Delhi, December 3, 2024 (TBB Bureau): The Union India has reiterated its commitment to supporting farmers by ensuring the uninterrupted availability of fertilizers at affordable prices, even amid ongoing global uncertainties caused by the Russia-Ukraine conflict. Union Minister of State for Chemicals and Fertilizers Anupriya Patel highlighted the measures in place during a Rajya Sabha session on Tuesday.
Urea continues to be provided to farmers at a statutorily notified Maximum Retail Price (MRP), regardless of its production cost. Currently, a 45-kg bag of urea is subsidized at ₹242, excluding neem-coating charges and applicable taxes. The government bridges the gap between the delivered cost of urea and the net market realization by offering subsidies directly to manufacturers and importers. This ensures that all farmers can access urea at the subsidized rate, providing critical support for agricultural productivity.
The government has implemented the Nutrient Based Subsidy (NBS) Policy since April 1, 2010, for Phosphatic and Potassic (P&K) fertilizers. Under this policy, subsidies are determined based on the nutrient content — Nitrogen (N), Phosphorus (P), Potassium (K), and Sulphur (S) — and revised annually or biannually. While the import of P&K fertilizers remains decontrolled, the government monitors global price fluctuations and adjusts NBS rates accordingly to stabilize the market and ensure affordability.
Amid the disruptions caused by the Russia-Ukraine war, the government has taken proactive steps to provide additional financial packages over and above the NBS rates during critical seasons such as Rabi and Kharif from 2021 to 2024. These measures have helped maintain stable fertilizer prices, shielding farmers from market volatility.
Recognizing the importance of diversifying supply chains, the government has fostered strategic engagements with fertilizer resource-rich countries. This includes facilitating Long-Term Agreements between Indian fertilizer companies and international suppliers to ensure consistent availability of raw materials and finished fertilizers.
