The effort is aimed at cutting the use of chemical fertilisers, while also improving crop yields and saving on subsidies.
The country's annual subsidy is about Rs 73,000 crore, a majority of which is paid to the manufacturers of controlled fertiliser urea.
The Department of Fertilisers (DoF) is working on a road-map to capture the details of farmers so that sales data can be captured and subsidy can be transferred to farmers' accounts directly, according to a Parliamentary Standing Committee report.
"The committee is of the view that transfer of the benefits of direct subsidy to the farmers would check the corruption, close the loopholes and profligacy in subsidies," the Parliamentary Committee on Chemicals and Fertilisers said in its report.
In an interview with CNBC_TV18, Satish Chandra, chairman and managing director of Madras Fertilizers and also the joint secretary of Department of Fertilisers, spoke about the latest happenings in his sector and the road ahead.