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

[pib] Nutrient Based Subsidy (NBS) rates and its fixation


From UPSC perspective, the following things are important :

Prelims level : NBS schemes

Mains level : NBS scheme and its benefits

Union Cabinet has approved fixation of Nutrient Based Subsidy (NBS) rates for Phosphatic and Potassic (P&K) fertilizers for the year 2020-21.


Fertilizer subsidy  accounts for large fiscal subsidies (about 0.73 lakh crore or 0.5 per cent of GDP), the second-highest after food.  We can expect a question like – “Discuss the role of NBS in ensuring land fertility and farm productivity in India.”


About Nutrient Based Subsidy (NBS) Scheme

  • The NBS Scheme for fertilizer was initiated in the year 2010 and is being implemented by the Department of Fertilizers.
  • Government is making available fertilizers, Urea and 21 grades of P&K fertilizers to farmers at subsidized prices through fertilizer manufacturers/importers.

What NBS provides?

  • The scheme allows the manufacturers, marketers, and importers to fix the MRP of the Phosphatic and Potash fertilizers at reasonable levels.
  • The MRP will be decided considering the domestic and international prices of P&K fertilizers, inventory level in the country and the exchange rates.
  • The NBS ensures that adequate quantity of P&K is made available to the farmers at a statutory controlled price.

Fertilizers covered

  • Under this, a fixed amount of subsidy decided on an annual basis is provided on each grade of subsidized Phosphatic and Potassic (P&K) fertilizers, except for Urea based on the nutrient content present in them.
  • It is largely for secondary nutrients like N, P, S and K and micronutrients which are very important for crop growth and development.
  • In India, urea is the only controlled fertilizer and is sold at a statutory notified uniform sale price.

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