Budget 2013-14: Fert Min explains position on fertiliser subsidy to PMO

Fertiliser Ministry today sent a status report to Prime Minister's Office (PMO) on the issue of private firms being reportedly favoured in grant of subsidy on certain fertilisers.

The ministry in the note explained the basis for providing nutrient based subsidy (NBS) on phosphatic and potassic (P&K) fertilisers like DAP and MoP manufactured largely by private companies.

Sources said the ministry vehemently rejected extending any undue profits to the fertiliser companies.

It clarified that under the NBS Policy, approved by the Cabinet and implemented from April 1, 2010, a fixed amount of subsidy is announced on annual basis for each fertiliser and the companies are free to fix the maximum retail price (MRP).

The ministry added that while fixing the subsidy, government takes into account the prevailing global prices, the exchange rate as well as affordability by the farmers.

There is complete transparency as prevailing international prices and the exchange rate are well known, it added.