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

[pib] Nutrient Based Subsidy (NBS) for P&K Fertilizers


From UPSC perspective, the following things are important :

Prelims level: NPK fertilizers, Soil Health Card

Mains level: Nutrient Based Subsidy (NBS) Scheme

The Cabinet Committee on Economic Affairs has approved the proposal of the Department of Fertilizers for fixation of Nutrient Based Subsidy Rates for P&K Fertilizers for the year last quarter of the year 2021-22.

An aspirant from rural agrarian background is quite habitual to hear about NPK 10-26-26, 20-20-0-13 & 12-32-16. They often get to find the plastic gunny bags mentioning this!

Nutrient Based Subsidy (NBS)

  • The NBS Scheme for fertilizer was initiated in the year 2010 and is being implemented by the Department of Fertilizers.
  • Under the scheme, a fixed amount of subsidy decided on an annual basis is provided on each grade of subsidized 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.

What is NPK?

  • So now that you know what the numbers on fertilizer mean, you need to know why NPK is important to your plants.
  • All plants need nitrogen, phosphorus, and potassium to grow. Without enough of any one of these nutrients, a plant will fail.
  1. Nitrogen (N): It is largely responsible for the growth of leaves on the plant.
  2. Phosphorus (P): It is largely responsible for root growth and flower and fruit development.
  3. Potassium (K): It is a nutrient that helps the overall functions of the plant perform correctly.
  • Knowing the NPK values of fertilizer can help you select one that is appropriate for the type of plant you are growing.

What NBS provides?

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

Issues with NBS

  • Leaves urea: Urea which the most widely used, is left-out in the scheme and hence it remains under price control as NBS has been implemented only in other fertilizers.
  • Cost on exchequer: Fertilizer subsidy is the second-biggest subsidy after food subsidy.
  • Costs on Economy and Environment: The NBS policy is not only damaging the fiscal health of the economy but also proving detrimental to the soil health of the country.
  • Black marketing: Subsidised fertilizers is getting diverted to bulk buyers/traders or even non-agricultural users such as plywood and animal feed makers.

Back2Basics: Soil Health Card (SHC)

  • Soil Health Card (SHC) scheme is promoted by the Department of Agriculture & Co-operation under the Ministry of Agriculture and Farmers’ Welfare.
  • An SHC is meant to give each farmer soil nutrient status of his/her holding and advice him/her on the dosage of fertilizers and also the needed soil amendments, that s/he should apply to maintain soil health in the long run.
  • SHC is a printed report that a farmer will be handed over for each of his holdings.
  • It will be made available once in a cycle of 2 years, which will indicate the status of soil health of a farmer’s holding for that particular period.
  • The SHC given in the next cycle of 2 years will be able to record the changes in the soil health for that subsequent period.

Parameters of SHC:

  • N, P, K (Macro-nutrients)
  • Sulfur (S) (Secondary- nutrient)
  • Zn, Fe, Cu, Mn, Bo (Micronutrients)
  • pH, EC (Electrical conductivity) , OC (Organic content)

Try this PYQ:

The nation-wide ‘Soil Health Card Scheme’ aims at:

  1. expanding the cultivable area under irrigation.
  2. enabling the banks to assess the quantum of loans to be granted to farmers on the basis of soil quality.
  3. checking the overuse of fertilizers in farmlands.

Which of the above statements is/are correct?

(a) 1 and 2 only

(b) 3 only

(c) 2 and 3 only

(d) 1, 2 and 3


Post your answers here.
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