Subsidy on DAP fertiliser hiked by 140%; Govt takes historic pro-farmer decision of hiking fertiliser subsidy

PM stressed that farmers should get fertilisers at old rates despite the international rise in prices.

May 20, 2021 08:05 IST India Infoline News Service

PM Narendra Modi chaired a high-level meeting on the issue of fertiliser prices. A detailed presentation was given to him on the issue of fertiliser prices.

It was discussed that the price of fertilisers is undergoing an increase due to the rising prices of phosphoric acid, ammonia etc. internationally. PM stressed that farmers should get fertilisers at old rates despite the international rise in prices.

A historic decision was taken to increase the subsidy for DAP fertiliser from Rs500 per bag to Rs1200 per bag, which is an increase of 140%. Thus, despite the rise in international market prices of DAP, it has been decided to continue selling it at the older price of Rs1200 and the central government has decided to bear all the burden of price hike. The amount of subsidy per bag has never been increased so much at once.

Last year, the actual price of DAP was Rs1,700 per bag. In which the Central Government was giving a subsidy of Rs500 per bag. So the companies were selling fertilizer to farmers for Rs1200 per bag.

Recently, the international prices of phosphoric acid, ammonia etc. used in DAP have gone up by 60% to 70%. So the actual price of a DAP bag is now Rs2400, which could be sold by Fertilizer companies at Rs1900 after considering a subsidy of Rs500. With today’s decision, farmers will continue to get a DAP bag for Rs1200.

PM remarked that his Government is committed to the welfare of farmers and will take all efforts to ensure that farmers do not have to face the brunt of price-rise.

The Central Government spends about Rs80,000cr on subsidies for chemical fertilisers every year. With the increase in subsidy in DAP, the Government of India will spend an additional Rs14,775cr as subsidy in Kharif season.

This is the second major decision in the farmers’ interest, after directly transferring Rs20,667cr to Farmers’ account under PM-KISAN on the day of Akshay Tritiya.

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