The Centre is making 25 grades of P&K fertilizers available to farmers at subsidised prices.
| Photo Credit: REUTERS

The Union Cabinet, on Thursday, approved the Nutrient Based Subsidy (NBS) rates for the upcoming Kharif season on Phosphatic and Potassic (P&K) fertilizers and to include three more fertilizer grades under the NBS scheme.

The Centre said tentative budgetary requirements for the scheme would be about ₹24,420 crore. The subsidy on Nitrogen (N) has been fixed at ₹47.02 per kilogram, phosphatic (P) at ₹28.72 per kg (₹20.82 per kg in 2023 rabi season), potassic (K) at ₹2.38 per kg, and Sulphur (S) at ₹1.89 per kg, the Union Information and Broadcasting Minister Anurag Thakur told presspersons after the Cabinet meeting. The subsidy on nitrogen (N), potassic (K) and Sulphur (S) was the same in the 2023 rabi season too.

The Union Fertilizers Ministry said in a release that the decision will ensure the availability of fertilizers to farmers at subsidised, affordable and reasonable prices and rationalisation of subsidy on P&K fertilizers in view of recent trends in the international prices of fertilizers and inputs.

“Inclusion of three new grades in NBS will support in promoting balanced soil health and offer alternatives to the framers to choose fertilizers fortified with micro-nutrients as per the soil requirement,” the release added. The Centre is making 25 grades of P&K fertilizers available to farmers at subsidised prices through manufacturers and importers.

Mr. Thakur said with this subsidy, DAP which is sold currently at ₹1,350 per bag (50 kg), will continue to be available at the same rate in the upcoming 2024 Kharif season. He said the rate of Muriate of Potash (MoP) will also remain unchanged at ₹1,670 per bag and the rate of NPK will be ₹1,470 per bag.

The Status Committee of Parliament on Chemical compounds and Fertilizers, headed by way of senior Congress chief Shashi Tharoor, in its two reviews tabled right here on Wednesday, has posed questions at the availability of fertilizers and a subsidy coverage. The panel has additionally wondered the prime GST fee on parts of fertilizers.

The reviews have also referred to as for finishing the import dependency on fertilizers equivalent to urea, diammonium phosphate (DAP), muriate of potash (MOP), nitrogen, phosphorus, and potassium (NPK). The manufacturing of those fertilizers as much as November, 2022 used to be 281.83 lakh metric tonnes however the intake used to be 401.46 LMT. “Thus, there was a deficit of 119.63 LMT for all types of fertilizers in the country, which is worrisome,” the panel stated.

The panel requested the Segment of Fertilizers to establish the explanations for insufficiency of fertilizers being reported in one of the vital States within the nation and assure availability of fertilizers in each and every Circumstance by way of taking corrective steps. The panel sought the overview of a nutrient-based subsidy (NBS) that covers fertilizers like P&Okay fertilizers. “Urea is left out of the scheme and hence it remains under price control whereas technically there is no price control in other fertilisers,” the panel stated, recommending the Centre to study the existing NBS coverage to deliver to take away the disincentives for farmers to importance alternative fertilizers.

The committee famous that GST for fertilizers is at 5% and GST on uncooked fabrics like sulphuric acid and ammonia are at 18%. “The committee failed to understand this anomaly,” the document added and requested the Centre to decrease the GST on uncooked fabrics within the pastime of fertilizer production corporations and farmers. It stated that herbal fuel may well be introduced underneath the GST internet as there are circumstances of double levying of VAT on herbal fuel.

The panel additionally advisable that the Centre introduce acquire coverage reforms and input into long run word of honour for import of diverse kinds of fertilizers and uncooked fabrics so that you could offset the results of global worth stand within the scale down/medium time period. “Besides, it is imperative that the Department should be more realistic in projecting their demands of funds at Budget Estimates stage and get adequate funds to facilitate timely and optimum utilisation of funds,” it added.

Union Minister for Health & Family Welfare and Chemicals & Fertilizers Mansukh Mandaviya addresses a press conference on Cabinet Decisions, in New Delhi on June 28, 2023.
| Photo Credit: PTI

The Cabinet Committee on Economic Affairs (CCEA) on Wednesday approved the PM-PRANAM (PM Programme for Restoration, Awareness, Generation, Nourishment and Amelioration of Mother Earth) scheme, which was a promise made in the last Budget. Union Fertilizer Minister Mansukh Mandaviya told reporters after the meeting that the new scheme would promote use of nutrient-based, biofertilizers for sustainable agriculture and it would have a total outlay of ₹3,70,128.7 crore.

The CCEA also hiked the Fair and Remunerative Price (FRP) of sugarcane by ₹10 per quintal. The FRP for the sugar season 2023-24 (October-September) will be ₹315 per quintal for a basic recovery rate of 10.25%. Last year, the amount was ₹305.

The PM-PRANAM scheme was aimed at saving the soil and promote sustainable, balanced use of fertilizers and it involved the participation of State governments, Mr. Mandaviya said. He said the Centre would incentivise those States which would adopt alternative fertilizers with the subsidy that was saved by reducing the use of chemical fertilizers. Mr. Mandaviya said if a State was using 10 lakh tonnes of conventional fertilizers and reduces its consumption by three lakh tonnes, then the subsidy saving would be ₹3,000 crore. “Out of that subsidy savings, the Centre will give 50% of it — ₹1,500 crore to the State for promoting the use of alternative fertilizer and other development works,” the Minister added.

Also read: Cabinet nod to set up National Research Foundation to boost R and D

Urea subsidy scheme

The Centre said in a release that the scheme included a bouquet of various schemes which would boost farmers’ income, strengthen natural / organic farming, rejuvenate soil productivity, and ensure food security. The CCEA also approved continuation of the urea subsidy scheme to ensure constant availability of urea to the farmers at the same price of ₹242/ 45 kg per bag. “Out of the above approved package, ₹3,68,676.7 crore has been committed for urea subsidy for three years. This is apart from recently approved nutrient-based subsidy of ₹38,000 crore for the Kharif season for 2023-24. The farmers need not spend extra for purchase of urea, and this will help moderate their input costs,” the release said.

Mr. Mandaviya said the use of nano urea had also increased in the country. “By 2025-26, eight nano urea plants with production capacity of 44 crore bottles, equalling to 195 lakh tonnes of conventional urea, will be commissioned,” he said.

Apart from that, ₹1,451.84 crore has been approved for Market Development Assistance (MDA) for promoting organic fertilizers from Gobardhan plants. Fermented Organic Manures (FOM)/Liquid FOM/Phosphate Rich Organic Manures (PROM) produced as by-product from bio-gas plants/Compressed Biogas (CBG) plants set up under umbrella Gobardhan initiative will be promoted. “Such organic fertilizers would be branded in the names of Bharat Brand FOM, LFOM and PROM. This on one hand will facilitate in addressing the challenge of management of crop residue and problems of stubble burning, and will also help in keeping the environment clean and safe and at the same time provide an additional source of income for farmers. Farmers will get organic fertilizers (FOM/LFOM/ PROM) at affordable prices,” the Centre said.

Also read: Govt. hikes sugarcane FRP by ₹10/quintal to ₹315/quintal for 2023-24 season

 

Cane farmers to benefit

Regarding the sugarcane FRP hike, the Centre said the decision was taken in the interest of sugarcane farmers. The CCEA also decided to provide a premium of ₹ 3.07 per quintal for each 0.1% increase in recovery over and above 10.25%, and reduction in FRP by ₹ 3.07 per quintal for every 0.1% decrease in recovery (sugar produced from the sugarcane).

“Further, with a view to protect interest of sugarcane farmers, government has also decided that there shall not be any deduction in case of sugar mills where recovery is below 9.5%. Such farmers will get ₹ 291.975 per quintal for sugarcane in ensuing sugar season 2023-24 in place of ₹ 282.125 per quintal in current sugar season 2022-23,” a Government release said. Announcing the decision after the CCEA meeting, Cabinet Minister for Information and Broadcasting Anurag Thakur said the move will also help to reduce the arrears to be given to farmers and sugar mills have adequate money to pay farmers.

The Centre has calculated the cost of production of sugarcane as ₹ 157 per quintal based on the inputs from States and the Commission on Agricultural Costs and Prices (CACP). “This FRP of ₹ 315 per quintal at a recovery rate of 10.25% is higher by 100.6% over production cost. The FRP for sugar season 2023-24 is 3.28% higher than current sugar season 2022-23,” the Centre said.

In 2022-23, about 3,353 lakh tons of sugarcane of worth ₹1,11,366 crore purchased by sugar mills. A part of this is used for ethanol production too. “The Ethanol Blended with Petrol (EBP) Programme has saved foreign exchange as well as strengthen energy security of the country and has reduced dependence on imported fossil fuel thereby helping in achieving the goal of Atmanirbhar Bharat in petroleum sector,” the Centre said.