{"id":76372,"date":"2026-06-10T18:17:44","date_gmt":"2026-06-10T12:47:44","guid":{"rendered":"https:\/\/www.nextias.com\/ca\/?p=76372"},"modified":"2026-06-10T18:19:26","modified_gmt":"2026-06-10T12:49:26","slug":"fertiliser-subsidy-burden","status":"publish","type":"post","link":"https:\/\/www.nextias.com\/ca\/current-affairs\/10-06-2026\/fertiliser-subsidy-burden","title":{"rendered":"Rise in India\u2019s Fertiliser Subsidy Burden"},"content":{"rendered":"\n<p><strong>Syllabus: GS3\/ Economy<\/strong><\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>Context<\/strong><\/h2>\n\n\n\n<ul class=\"wp-block-list\">\n<li>India&#8217;s fertiliser subsidy burden is expected to rise sharply to around <strong>\u20b93.4 lakh crore in 2026-27,<\/strong> nearly double the Budget Estimate of <strong>\u20b91.71 lakh crore<\/strong>, due to surging global fertiliser prices, supply disruptions, and geopolitical tensions in West Asia.<\/li>\n<\/ul>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>What are Fertilizers?<\/strong><\/h2>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Fertilizers are <strong>concentrated plant nutrients<\/strong> made from <strong>inorganic chemicals.\u00a0<\/strong><\/li>\n\n\n\n<li>Unlike organic manure, fertilizers contain nutrients in higher amounts and are <strong>applied in smaller quantities.<\/strong><\/li>\n<\/ul>\n\n\n<div class=\"wp-block-image\">\n<figure class=\"aligncenter size-full is-resized\"><img data-dominant-color=\"e4e6e9\" data-has-transparency=\"false\" loading=\"lazy\" decoding=\"async\" width=\"606\" height=\"372\" src=\"https:\/\/wp-images.nextias.com\/cdn-cgi\/image\/format=auto\/ca\/uploads\/2026\/06\/image-74.png\" alt=\"type of fertilizers\" class=\"not-transparent wp-image-76373\" style=\"--dominant-color: #e4e6e9; width:500px;height:auto\" srcset=\"https:\/\/wp-images.nextias.com\/cdn-cgi\/image\/format=auto\/ca\/uploads\/2026\/06\/image-74.png 606w, https:\/\/wp-images.nextias.com\/cdn-cgi\/image\/format=auto\/ca\/uploads\/2026\/06\/image-74-300x184.png 300w\" sizes=\"auto, (max-width: 606px) 100vw, 606px\" \/><\/figure>\n<\/div>\n\n\n<h2 class=\"wp-block-heading\"><strong>Mechanism of Subsidy<\/strong><\/h2>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong>Subsidy on Sale Price:<\/strong> The government provides financial support to fertilizer manufacturers or importers, lowering the price of fertilizers sold to farmers.<\/li>\n\n\n\n<li><strong>Direct Benefit Transfer (DBT):<\/strong> In some cases, the subsidy is transferred directly to farmers through their bank accounts to reduce intermediaries and ensure transparency.<\/li>\n\n\n\n<li><strong>Fixed Subsidy Rates: <\/strong>For urea, the subsidy is fixed per kilogram of the product, and for others like DAP, it is adjusted periodically based on market prices.<\/li>\n<\/ul>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>Why is the Fertiliser Subsidy Rising?<\/strong><\/h2>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong>Global Supply Disruptions:<\/strong> The ongoing conflict in West Asia and disruption of the<strong> Strait of Hormuz <\/strong>have increased fertilizer and energy prices globally.\n<ul class=\"wp-block-list\">\n<li>Major suppliers, including<strong> China<\/strong>, have restricted exports to secure domestic supplies.<\/li>\n<\/ul>\n<\/li>\n\n\n\n<li><strong>Sharp Increase in Import Prices:<\/strong> India&#8217;s recent urea imports were contracted at <strong>$935\u2013959 per tonne<\/strong>, compared to $410\u2013420 per tonne a year earlier.\n<ul class=\"wp-block-list\">\n<li>The cost of a fertiliser sack has increased from around<strong> \u20b93000 post-Covid to \u20b94,500,<\/strong> while farmers continue to receive it at heavily subsidised rates.<\/li>\n<\/ul>\n<\/li>\n\n\n\n<li><strong>Dependence on Imports: <\/strong>India remains one of the world&#8217;s largest fertiliser importers. Gulf countries such as <strong>Oman, Qatar, Saudi Arabia, UAE, and Bahrain <\/strong>account for around <strong>40%<\/strong> of India&#8217;s urea imports.<\/li>\n<\/ul>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>Government\u2019s Initiatives in the Fertilizer Sector<\/strong><\/h2>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong>PM PRANAM scheme:<\/strong> PM Programme for Restoration, Awareness Generation, Nourishment and Amelioration of Mother \u2013 Earth (PMPRANAM) was launched to incentivize States\/ Union Territories to promote alternate fertilizers and balanced use\u00a0 of chemical fertilizers.<\/li>\n\n\n\n<li><strong>Neem-coated urea: <\/strong>The government has introduced <strong>100% Neem Coating<\/strong> on all subsidized agricultural grade urea in the country in order to increase the nutrient efficiency, crop yield, soil health and check the diversion of agricultural grade urea for non-agricultural activities.<\/li>\n\n\n\n<li><strong>Sulfur Coated Urea (Urea Gold)<\/strong> was introduced to overcome the sulfur deficiency in the soil and reduce the input cost of the farmers.\u00a0<\/li>\n\n\n\n<li><strong>Nutrient-based subsidy policy: <\/strong>It aims to promote the balanced use of fertilizers by linking subsidies to the nutrient content (nitrogen, phosphorus, potash, and sulfur) rather than the final product.\n<ul class=\"wp-block-list\">\n<li>Under this scheme, the government sets a fixed subsidy amount per kilogram for each nutrient in P&amp;K fertilizers.<\/li>\n<\/ul>\n<\/li>\n\n\n\n<li><strong>Nano Urea:<\/strong> It is a liquid fertilizer developed by <strong>IFFCO.<\/strong> It is an alternative to conventional urea.\u00a0<\/li>\n<\/ul>\n\n\n\n<h3 class=\"wp-block-heading\"><strong>Way Ahead<\/strong><\/h3>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong>Capacity Expansion: <\/strong>Speeding up commissioning of domestic urea plants under \u201cAtmanirbhar Bharat\u201d will reduce import reliance.<\/li>\n\n\n\n<li><strong>Sustainable Practices: <\/strong>Wider adoption of nano-urea, bio-fertilisers, and soil health cards can reduce chemical fertiliser intensity over time.<\/li>\n\n\n\n<li><strong>Improving Supply Chain Resilience:<\/strong> India should diversify its import sources to reduce dependence on specific regions. Strategic reserves of fertilisers should be developed to manage future disruptions.<\/li>\n\n\n\n<li><strong>Encouraging Biostimulants:<\/strong> Biostimulants should be promoted as they enhance nutrient uptake and improve plant metabolism.\n<ul class=\"wp-block-list\">\n<li>These products can reduce the effective requirement of chemical fertilisers by improving their efficiency.<\/li>\n<\/ul>\n<\/li>\n<\/ul>\n\n\n\n<p><strong>Source: <\/strong><a href=\"https:\/\/indianexpress.com\/article\/business\/india-us-deal-only-after-section-301-probe-is-over-10730500\/?ref=infinite\" target=\"_blank\" rel=\"noopener\"><strong>IE<\/strong><\/a><\/p>\n","protected":false},"excerpt":{"rendered":"<p><strong> Context <\/strong><\/p>\n<li class=\"ms-5\"> India&#8217;s fertiliser subsidy burden is expected to rise sharply to around \u20b93.4 lakh crore in 2026-27, nearly double the Budget Estimate of \u20b91.71 lakh crore, due to surging global fertiliser prices, supply disruptions, and geopolitical tensions in West Asia. <\/li>\n<p><\/p>\n<p><strong> What are Fertilizers? <\/strong><\/p>\n<li class=\"ms-5\"> Fertilizers are concentrated plant nutrients made from inorganic chemicals.\u00a0 <\/li>\n<li class=\"ms-5\"> Unlike organic manure, fertilizers contain nutrients in higher amounts and are applied in smaller quantities. <\/li>\n<p><a href=\" https:\/\/www.nextias.com\/ca\/current-affairs\/10-06-2026\/fertiliser-subsidy-burden \" class=\"btn btn-primary btn-sm float-end\">Read More<\/a><\/p>\n","protected":false},"author":15,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[21],"tags":[],"class_list":["post-76372","post","type-post","status-publish","format-standard","hentry","category-current-affairs"],"acf":[],"jetpack_featured_media_url":"","_links":{"self":[{"href":"https:\/\/www.nextias.com\/ca\/wp-json\/wp\/v2\/posts\/76372","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.nextias.com\/ca\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.nextias.com\/ca\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.nextias.com\/ca\/wp-json\/wp\/v2\/users\/15"}],"replies":[{"embeddable":true,"href":"https:\/\/www.nextias.com\/ca\/wp-json\/wp\/v2\/comments?post=76372"}],"version-history":[{"count":3,"href":"https:\/\/www.nextias.com\/ca\/wp-json\/wp\/v2\/posts\/76372\/revisions"}],"predecessor-version":[{"id":76377,"href":"https:\/\/www.nextias.com\/ca\/wp-json\/wp\/v2\/posts\/76372\/revisions\/76377"}],"wp:attachment":[{"href":"https:\/\/www.nextias.com\/ca\/wp-json\/wp\/v2\/media?parent=76372"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.nextias.com\/ca\/wp-json\/wp\/v2\/categories?post=76372"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.nextias.com\/ca\/wp-json\/wp\/v2\/tags?post=76372"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}