Ministry of Chemicals and Fertilizers issued guidelines regarding reasonableness of Maximum Retail Prices (MRPs) of Phosphatic and Potassic (P&K) fertilizers under the Nutrient Based Subsidy (NBS) policy.Â
About Nutrient Based Subsidy (NBS) Policy
- Objective: Government introduced the NBS policy in 2010 with an aim to provide fertilizers to the farmers at the subsidized prices.
- It has been approved for implementation up to FY 2025-26.Â
- Basis: It has been framed under Fertilizer (Control) Order (FCO), 1985 issued under Essential Commodities Act, 1955.
- FCO lays down as to what substances qualify for use as fertilizers in the soil, product-wise specifications, procedure for obtaining license/registration as manufacture/dealer in fertilizers and conditions to be fulfilled for trading thereof, etc.Â
- Eligibility: NBS is applicable for 25 grades of P&K fertilizers namely, Di Ammonium Phosphate (DAP), Muriate of Potash (MOP), Mono Ammonium Phosphate (MAP), Triple Super Phosphate (TSP), etc.
- Government announces a fixed rate of subsidy (in Rs. Per Kg basis), on each primary nutrient of subsidized P&K fertilizers, namely Nitrogen (N), Phosphate (P), Potash (K) and Sulphur (S), on annual basis.Â
- Subsidy recommendations: Inter-Ministerial Committee (IMC) recommends per nutrient subsidy for ‘N’, ‘P’, ‘K’ and ‘S’ before the start of the financial year for decision by Department of Fertilizers.Â
Urea subsidy policy:
- MRP of urea is statutorily fixed by the Government of India.
- The difference between the delivered cost of fertilizers at farm gate and MRP payable by the farmer is given as subsidy to the fertilizer manufacturer/importer by the Government of India.Â
- Subsidy on urea is paid on dispatch whereas NBS is paid on quantities sold.Â
Fertilizer Grade Definition:
- It refers to the guaranteed minimum percentage of three key nutrients in fertilizer material: Nitrogen (N) , Phosphorus (P), Potash (K)
