CCEA approves Nutrient Based Subsidy rates for Phosphatic & Potassic Fertilisers for 2021-22

New Delhi, June 17, 2021

The Cabinet Committee on Economic Affairs (CCEA) on Wednesday approved a proposal of the Department of Fertilizers for fixation of Nutrient Based Subsidy Rates for P&K Fertilizers for the year 2021-22 (till the present season).

The approved rates for NBS effective from the date of notification will be Rs 18.789 per kg subsidy for N (Nitrogen), Rs 45.323 per Kg for P (Phosphorus), Rs 10.116 for K (Potash) and Rs 2.374 for S (Sulphur).

The Government is making available fertilizers, namely urea and 22 grades of P&K fertilizers (including DAP) to farmers at subsidized prices through fertilizer manufacturers/importers, an official press release said.

The subsidy on P&K fertilizers is being governed by the NBS Scheme from April 1, 2010. The subsidy is released to fertilizer companies as per NBS rates so that they can make available fertilizers to farmers at affordable prices.

In the past few months, the international prices of raw materials of DAP and other P&K fertilizers have increased sharply. Prices of finished DAP and others in the international market have also increased. Despite this sharp increase, DAP prices in India were initially not increased by the companies. However, some companies increased the DAP price at the beginning of this financial year.

On the pricing front of DAP, Government has asked all the fertilizer companies to sell their old stocks of DAP etc. at the old prices. Various special packages have been announced considering the hardships faced by the people during the COVID-19 pandemic.

Similarly, considering this crisis of pricing of DAP in India as an extraordinary situation and distressful for the farmers, the subsidy rates under the NBS Scheme were increased as a special package for farmers in such a way that MRP of DAP (including other P&K fertilisers) would be kept at the last year's level till the present Kharif season.

This has been done as a one-time measure as a COVID-19 package to reduce the hardships of farmers. As it is anticipated that international prices may come down in a few months, the government may review the situation. The estimated additional subsidy burden for such an arrangement will be around Rs 14,775 crore, the release added.

NNN