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Government Aims to Cap Fertiliser Subsidy and Pilot Projects

Published on March 20, 2023
Current context: The government will roll out a modified direct benefit transfer (DBT) scheme of fertilisers in seven districts on a pilot basis. Under the new plan, sales of subsidised fertilisers to farmers will be capped.
  • According to Arun Singhal, secretary, department of fertilizers, the quota of highly subsidised fertilisers to be sold to them will be fixed. The idea is to promote rational use of soil nutrients. “
  • States including Karnataka, Assam, Uttar Pradesh, Delhi and Maharashtra will be included for pilots in one district each. Because of higher global prices caused by the Ukraine war, the fertiliser subsidy in 2022-23 has surged to a record Rs 2.53 trillion.
  • Sale of all subsidised fertiliser to farmers or buyers is currently made through 0.26 million point of sale (PoS) devices installed at outlets since March 2018. Beneficiaries are identified through Aadhaar number, Kisan Credit Card and other documents.
  • The retail prices of phosphatic and potassic (P&K) fertiliser, including diammonium phosphate(DAP) were ‘decontrolled’ in 2020 with the introduction of a ‘fixed-subsidy’ regime as part of Nutrient Based Subsidy mechanism announced by the government twice in a year. Because of higher global prices, the fertiliser subsidy in 2022-23 is seen at a record Rs 2.53 trillion.
  • The country imports about half of its requirement of DAP and around 25% of urea requirements are met through imports.


Q.1 Government aims to cap fertiliser subsidy and pilot projects in how many districts ?
a. 7
b. 4
c. 3
d. 5
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