Punjab CM pitches for direct transfer of fertiliser subsidy
Punjab Chief Minister Parkash Singh Badal today asked the Chemical and Fertilisers Ministry to implement its proposal to directly transfer fertiliser subsidy to farmers on a pilot basis in order to resolve the issues and difficulties in its implementation.
June 20, 2011 / 16:28 IST
Punjab Chief Minister Parkash Singh Badal today asked the Chemical and Fertilisers Ministry to implement its proposal to directly transfer fertiliser subsidy to farmers on a pilot basis in order to resolve the issues and difficulties in its implementation.
In a letter to Chemicals and Fertilisers Minister M K Azhagiri, the Chief Minister reacted to the concept paper prepared by the Centre in this behalf and made certain observations after a detailed study.He said in the current system farmers have to pay only the subsidised price of the fertiliser. However, in the proposed system he/she would have to first pay the market price and then have the subsidy reimbursed in his/her bank account, which would cause unnecessary financial burden on the farmers, both in terms of initial higher investment and the interest cost for the period it takes to get the subsidy reimbursed.Badal also mentioned that it has been the practice in Punjab to preposition fertilisers to ensure the availability of the material in the state at the time of need. The Centre has appreciated this initiative on various occasions. For this purpose, the state's agencies make advance payment to the fertiliser companies to obtain the fertiliser. Henceforth, the payment of the market price rather than subsidised price would increase the financial burden on these agencies.Currently, the Centre gives subsidy only to a limited number of companies. In the new proposal, subsidy is proposed to be released to crores of individual farmers at different times in the year. This would involve a huge logistical and financial exercise, with correspondingly higher chance of leakage and harassment to the individual beneficiaries. Though technology can provide a solution in the ultimate analysis, difficulties during the intervening period could be quite daunting, added Badal.
The Chief Minster also stated that the concept paper does raise the issue of tenant farmers who actually cultivate the land but do not have the revenue record in their names. However, no solution to this problem has been laid out therein.Badal pointed out that these issues could create serious problems of implementation and lead to hardships for the intended beneficiaries. He therefore, urged the Centre to implement this proposal initially on a pilot basis to resolve the issues and difficulties that may come up in its implementation. Discover the latest Business News, Sensex, and Nifty updates. Obtain Personal Finance insights, tax queries, and expert opinions on Moneycontrol or download the Moneycontrol App to stay updated!
