Govt clears Rs 14,775-cr extra fertiliser subsidy

By: |
May 20, 2021 1:45 AM

The decision was taken at a high-level meeting, chaired by Prime Minister Narendra Modi, on Wednesday.

Recently, the international prices of phosphoric acid, ammonia etc. used in DAP have gone up by 60-70%.Recently, the international prices of phosphoric acid, ammonia etc. used in DAP have gone up by 60-70%.

The government has approved an additional subsidy of Rs 14,775 crore to keep prices of diammonium phosphate (DAP) fertiliser at the earlier level to soften the blow to farmers who have protested against rate hikes by companies over the past two months. With this decision, the subsidy on DAP fertiliser will jump to Rs 1,200 per bag from earlier Rs 500 and the farmers will continue to pay only Rs 1,200 per bag.

The decision was taken at a high-level meeting, chaired by Prime Minister Narendra Modi, on Wednesday.

While the actual price of DAP was Rs 1,700 per 50 kg bag last year, farmers were getting it at Rs 1,200/bag, as the government was providing a subsidy of Rs 500.

Recently, the international prices of phosphoric acid, ammonia etc. used in DAP have gone up by 60-70%.

Prices of phosphatic (P) and potassic (K) fertilisers are driven by the market, as subsidies provided by the government are minimal and fixed. These fertilisers are mostly imported.

The budget allocation for a subsidy of P and K fertilisers for FY22 was reduced to Rs 20,720 crore from about Rs 39,000 crore in FY21 (RE).

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