Urea Subsidy Scheme Extended Till 2020 – DBT in Fertilizer Subsidy to Farmers

Central government has decided to extend the Urea Subsidy Scheme till FY 2020. Subsequently, this fertilizer dbt scheme will provide direct benefit transfer of fertilizer subsidy to farmers. Accordingly, this dbt in fertilizers will ensure direct urea subsidy transfer and fertilizer subsidy directly to farmers. Moreover, govt. will provide dbt for fertilisers to assure supply of subsidized urea under fertilizer dbt rollout.

Govt. will provide urea at controlled price of Rs. 5,360 per tonne. Accordingly, Urea Subsidy Scheme will cost around Rs. 45,000 crore in 2018-19 which was Rs. 42,748 crore in previous year. Henceforth for 3 years (till 2020), this project will cost Rs. 1,64,000 crore to central govt.

Cabinet Committee on Economic Affairs (CCEA) has approved this proposal for fertilizer subsidy reforms. The primary focus of govt. is on making dbt in fertilisers work and to provide adequate quantity of urea to farmers at low prices.

Urea Subsidy Scheme / DBT in Fertilizer Subsidy to Farmers

The important features and highlights of this direct benefit transfer of fertilizer subsidy are as follows:-

  • Direct Urea Subsidy Transfer Scheme will enable farmers to purchase urea at subsidized price of Rs. 5,360 / tonne.
  • Subsequently, govt. will provide difference in the delivered cost of the fertiliser at farm gate and maximum retail price (MRP) as subsidy to manufacturers.
  • Accordingly, central govt. will spend Rs. 1.64 lakh crore in the next 3 years. Previously, Ministry of Chemicals and fertilizers needs to take clearance for every year. This time it got clearance for 3 years.
  • CCEA also approves implementation of Direct Benefit Transfer – dbt in fertilizer subsidy to properly disburse fertilizer subsidy directly to farmers.
  • This direct benefit transfer of fertilizer subsidy will reduce diversion and also plug the leakages.
  • Moreover, govt. is planning for nationwide fertilizer dbt rollout to provide dbt for fertilisers.
  • Furthermore, dbt in fertilizers will ensure 100% payment to fertilizers companies for making dbt in fertilisers work under fertilizer dbt scheme.

This continuation of Urea Subsidy Scheme will bring fertilizer subsidy reforms to ensure supply of fertilizer subsidy to farmers.

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