Fertilizers committee warns against under-funding of nutrient subsidy schemes

Parliamentary committee urges additional funds for fertilizer sector, expansion of nano urea and DAP production, and popularization of nano fertilizers.

The parliamentary Standing Committee on Chemicals and Fertilizers, headed by Trinamool Congress MP Kirti Azad, has urged the Union Fertilizers Ministry to seek additional funds for the sector at the revised estimate stage to ensure that subsidy schemes for farmers are not negatively affected.

In a report on Demands for Grants tabled in Parliament recently, the panel also recommended to the Centre the expantion of production capacity of nano urea and nano diammonium phosphate (DAP) by ensuring the timely establishment of production units. Additionally, it called for a strategy to popularise these nano fertilizers among farmers.

The Committee noted that while the Centre facilitates agreements between Indian fertilizer companies and their counterparts in resource-rich countries to ensure the availability of raw materials, intermediates, and finished fertilizers, no efforts have been made to secure mining lease agreements for extraction, exploration, refining, or production. It urged the Centre to enter into such agreements to bolster domestic supply. “Without introducing physical measures and pumping in Government, Public and Private investment, the goal of achieving self-sufficiency in the field of fertilizers is difficult to achieve,” the report stated.

The panel observed that while the Department of Fertilizers had projected an outlay of ₹ 1,84,704.63 crore for its various schemes in 2025-26, the Ministry of Finance had reduced this allocation by 7.38% to ₹ 1,71,082.44 crore. “The reduction has been made in both the Nutrient-Based Subsidy (NBS) Scheme and the Urea Subsidy Scheme of the Department,” the report said, adding that this cut would affect the smooth implementation of subsidy schemes.

The Committee also highlighted underutilisation of funds across various categories during 2024-25, including 20% under indigenous phosphorus and potassium (PK) fertilizers, 12% under imported PK, 14.76% under indigenous urea, and 59.57% under Market Development Assistance (MDA). It recommended that the Centre ensures full utilisation of allocations in a planned manner, with continuity under various heads of Ministry. Given the importance of urea in food-grain production, the panel stressed that the Urea Subsidy Scheme must continue.

Citing an increase in crop yield when combining nano urea with conventional urea, the panel noted that the highest yield improvement was observed in peas (6.14% to 14.82%) and the lowest in sugarcane (1.65% to 4%). “Field trials on Nano DAP have revealed that its use for seed treatment and foliar application could potentially reduce the requirement for conventional granular DAP. The Committee, therefore, recommends that the Department of Fertilizers should expand Nano Urea and Nano DAP production capacities by ensuring the timely establishment of the units envisaged in the future,” the report said.