NEWS

Cabinet approves Nutrient Based Subsidy (NBS) rates for Phosphatic and Potassic (P&K) fertilizers for Kharif Season

BACKGROUND

• Government is making available fertilizers, namely Urea and 25 grades of P&K fertilizers to farmers at subsidized prices through fertilizer manufacturers/ importers.
• The subsidy on P&K fertilizers is being governed by NBS Scheme w.e.f 01.04.2010
• In view of steep increase in the international prices of fertilizers & inputs i.e. Urea, DAP, MOP and Sulphur, Government has decided to absorb the increased prices by increasing subsidy on P&K fertilizers including DAP
• The subsidy would be released to fertilizer companies as per approved rates so that they can make available fertilizers to farmers at an affordable price than it would have been otherwise

BENEFITS – It will help farmers to receive notified P&K fertilizers on subsidized, affordable and reasonable rates and support the agriculture sector.

WHAT IS SUBSIDY

• Subsidy means grant
• May be in the form of either cash or kind and is generally given to promote an economic policy or social policy
• Subsidy is generally understood to be a grant extended by the Government, however, that is not a very strict definition
• The various forms of subsidy include direct subsidies such as cash grants, interest-free loans; indirect subsidies such as tax breaks, premium free insurance, low-interest loans, depreciation write-offs, rent rebates etc. Subsidies have been provided widely throughout the world as a tool for realizing government policies.