Fertilizer Sector reforms – NBS, bio-fertilizers, Neem coating, etc.

Fertilizer Subsidy to cost 62% more on input costs

Note4Students

From UPSC perspective, the following things are important :

Prelims level : NPK fertilizers

Mains level : Fertilizer subsidies in India

An unprecedented spike in natural gas prices and other raw materials is set to inflate the fertilizer subsidy bill by a whopping 62% or ₹50,000 crores to ₹1,30,000 crore this fiscal.

Fertilizer Subsidy in India

  • Fertilizer subsidy is purchasing by the farmer at a price below MRP (Maximum Retail Price), that is, below the usual demand-and-supply-rate, or regular production and import cost.
  • Subsidy as a concept originated during the Green Revolution of the 1970s-80s.

How does it work?

  • Fertilizer subsidy ultimately goes to the fertilizer company, even though it is the farmer that benefits.
  • Before 2018, companies were reimbursed after the material was dispatched and received by the district railhead or designated godown.
  • 2018 saw the beginning of DBT (Direct Benefit Transfer), which would transfer money directly to the retailer’s account.
  • However, the companies will be paid only after the actual sale to the farmer.
  • With the DBT system, each retailer — there is over 2.3 lakh of them across India — now has a point-of-sale (PoS) machine linked to the Department of Fertilizers’ e-Urvarak DBT portal.

What about non-urea fertilizers?

  • Decontrolled system: The non-urea fertilizer is decontrolled or fixed by the companies.
  • The non- urea fertilizers are further divided into two parts, DAP (Diammonium Phosphate) and MOP (Muriate of Phosphate).

Issues with such subsidies

  • Flawed subsidy policy: This is harmful not just to the farmer, but to the environment as well.
  • No permanent remedy: Indian soil has low Nitrogen use efficiency, which is the main constituent of Urea.
  • Excessive use: Consequently, excess usage contaminates groundwater.
  • Emission: The bulk of urea applied to the soil is lost as NH3 (Ammonia) and Nitrogen Oxides causing emissions.
  • Health hazards: For human beings, “blue baby syndrome” is a common side ailment caused by Nitrate contaminated water.

Post your answers in the comment box for this PYQ:

Q.What are the advantages of fertigation in agriculture? (CSP 2020)

1. Controlling the alkalinity of irrigation water is possible.
2. Efficient application of Rock Phosphate and all other phosphatic fertilizers is possible.
3. Increased availability of nutrients to plants is possible.
4. Reduction in the leaching of chemical nutrients is possible.

Select the correct answer using the code given below:
(a) 1, 2 and 3 only

(b) 1,2 and 4 only

(c) 1,3 and 4 only

(d) 2, 3 and 4 only

 

Post your answers here.
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Kanika Choudhary
Kanika Choudhary
6 months ago
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C

NIKHIL SURYAWANSHI
NIKHIL SURYAWANSHI
6 months ago
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A

Ashish Anand
Ashish Anand
6 months ago
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A

aditya pandey
aditya pandey
6 months ago
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B

Shivam Dwivedi
Shivam Dwivedi
6 months ago
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C