Highlights
• A jump in the price of crop nutrients on worldwide markets
• The decision to increase the fertilizer subsidy was made
• The subsidy will cover the period to September 2022
Over the next few months, India will provide a subsidy of 609.4 billion rupees ($7.96 billion) for phosphatic and potash-based fertilizers to protect farmers from rising world prices, according to the information and broadcasting minister Anurag Singh Thakur.
Union Minister Kishan G Reddy described the development as “excellent news for farmers. “The subsidies will remain in place until September 2022. For the preceding 12 months ended March 31, India provided a subsidy of 571.5 billion rupees, according to the minister.
What is the subsidy?
A subsidy is a monetary transfer from the government to a third party. As a result, the subsidized product’s price drops The aim of a subsidy is to improve society’s well-being.
It is a part of the government’s non-plan spending. Petroleum subsidies, fertilizer subsidies, food subsidies, interest subsidies, and so on are all major subsidies in India.
The decision to raise the fertilizers subsidy was taken after a spike in the prices of crop nutrients in global markets
A subsidy of 2,501 rupees per 50 kg bag of the crop nutrient diammonium phosphate will keep the price in local markets at 1,350 rupees, according to the minister, who detailed the federal cabinet’s decision.
The decision to boost the fertilizer subsidy was made in response to a global price jump in agricultural nutrients, owing to supply chain disruptions following Russia’s invasion of Ukraine, increasing freight, and rising energy costs.
