India maintains nutrient-based subsidy for Phosphorus and Potassium fertilisers for FY22

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India has kept the nutrient-based subsidy rates unchanged for phosphatic and potassic (P&K) fertilisers for the current 2021-22 fiscal till further orders. For the last fiscal, the government had fixed the subsidy rate for nitrogen (N) at Rs 18.78 per kg, phosphate (P) at Rs 14.88 a kg, potash (K) at Rs 10.11 per kg and sulphur (S) fertilisers at Rs 2.37 a kg.

In its latest order reported by the Press Trust of India, the fertiliser ministry said, “…the competent authority has decided to extend the NBS (Nutrient Based Subsidy) rates of the year 2020- 2021 for FY 2021-22 till further orders.” 

Industry experts said maintaining the same subsidy rates on P&K fertilisers for the current year will put pressure on retail prices of DAP and NPK soil nutrients amid rise in global prices and falling Indian rupee. Some companies have already increased retail prices of P&K fertilisers. 

In view of the sharp rise in global prices of raw materials, domestic fertiliser companies and cooperatives have increased the retail prices of DAP and other complex fertilisers. For instance, retail prices of Di-ammonium phosphate (DAP) have been hiked to up to Rs 1,700 per bag of 50 kg from Rs 1,200 per bag with effect from April 1, 2021.

Taking note of recent increase in retail prices of P&K fertilisers, the government, however, directed fertiliser companies not to increase the rates and told them to sell the stock at old rates. Retail prices of non-urea fertilisers such as DAP, Muriate of Potash (MoP) and NPK are decontrolled and are determined by manufacturers, while the Centre gives them fixed subsidies each year.

The fertiliser companies have been asked to sell the complex fertilisers at old rates. “Farmers will continue to get DAP, MoP and NPK nutrients at old rates,” the fertliser minister tweeted. The minister separately tweeted that “Giving priority to the interest of the farming community, there won’t be any increase in prices of fertilisers”.

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