The Centre will offer a whopping 140 per cent increase in subsidy on fertiliser to offset the price rise in international market, Prime Minister Narendra Modi's office said today. The government will spend an additional Rs 14,775 crore towards this subsidy.
"Prime Minster Narendra Modi has said farmers should get fertilisers at old rates despite the international price rise... The welfare of farmers is at the core of government's efforts," the PM's office said in a statement.
Farmers will get a subsidy of Rs 1,200 per bag of fertiliser instead of the current Rs 500. Instead of Rs 2,400 -- which is what the prices are working out to following the rise in global prices -- the farmers will continue to get a bag of DAP (Di-ammonium Phosphate) for Rs 1,200.
The decision on hiking the fertiliser subsidy came at a high-level meeting chaired by the Prime Minister this evening.
It was said the price of fertilisers is going up due to the rising prices of phosphoric acid, ammonia etc internationally. The Prime Minister stressed that farmers "should get fertilisers at old rates" despite the international rise in prices, the statement read.
Calling it a "historic decision", the PM's Office said, "The amount of subsidy per bag has never been increased so much at once".
"Last year, the actual price of DAP was Rs 1,700 per bag. In which the Central Government was giving a subsidy of Rs. 500 per bag. So the companies were selling fertilizer to farmers for Rs 1200 per bag," the statement read.
Advertisement"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 Rs 2400, which could be sold by Fertilizer companies at Rs 1900 after considering a subsidy of Rs 500. With today's decision, farmers will continue to get a DAP bag for Rs 1200," the statement added.
