Prime Minister Modi decided to hike the subsidy on DAP fertilizer by 140% from ₹500 per bag to ₹1200 per bag. PM stressed that farmers must get the fertilizers at old rates despite the rise in international prices amid pandemic to offset their production cost.
However, the Modi govt has taken this decision after facing flak from farmers on the DAP price hike by companies to Rs.1900 per bag in April. After this decision, farmers will continue to get a di-ammonium phosphate (DAP) fertilizer bag for Rs 1200, even when fertilizers like phosphoric acid, ammonia witnessed a steep hike internationally.
Meanwhile, agriculture expert Vijay Sardana said that “this is a timely intervention by the govt to increase the subsidy for DAP fertilizer from Rs. 500 per bag to Rs. 1200 per bag, which is a net increase of 140%, before the start of Kharif sowing”. He feels that this will help farmers immensely who are facing the heat of high input costs due to rising diesel and fertilizers’ prices’.
Earlier in April after the proposed hike by fertilizer companies in DAP prices, Sanyukta Kisan Morcha (SKM) has asked the govt to roll back prices in the interest of farmers. The SKM further said that though the govt has not abolished the MSP system with high input costs MSP realisations are becoming unprofitable.
The centre has shown sensitivity and rightly lent its ears to the fertiliser issue after facing the ire of farmers on farms bills in the form of ongoing protest on Dehli borders started from Nov 2020. Modi govt move comes a month after the Indian fertilizer companies announced price hike in the DAP prices. The Indian Farmers Fertiliser Cooperative (IFFCO), had raised the price of 50-kg DAP bag by 58 per cent on April 8, from Rs. 1,200 per bag to straight Rs.1,900 per 50 kg/bag effective from April 1, 2021. However, the Centre had urged the state as well as private fertilizer companies to check & hold the DAP prices to “reasonable” levels.
‘As far as the DAP prices are concerned last year, the actual price of DAP was Rs 1,700 per bag where the Centre chips in with a subsidy of Rs. 500 per bag. So in the end the companies will sell fertilizers to farmers for Rs. 1200 a bag’ informed fertiliser ministry.
However, the increase in subsidy for DAP fertilisers will put an extra burden of Rs 14,775 crore on the exchequer in the upcoming kharif season. The central govt spends around Rs 80,000 crore on chemical and fertilisers subsidies every year and it will take it to around 94 thousand crore annualy.
Meanwhile, on the MSP procurement front, the Central govt has maintained the uptrend by procuring about 38.35 MT of wheat worth Rs. 75,514 crore at MSP value, up by 24% from the previous year as of 21 May 2021, against the wheat procurement target of a record 43 million tonnes (MT) which will end on June 30 still a month to go to achieve this target amid the Covid restrictions.
On MSP front, Modi govt has broken its own MSP procurement record of Rs. 62808.88 crores set in previous rabi marketing season of 2020-21 by paying about Rs. 75,514 crore in MSP value to Rs. 39.95 lakh directly into their bank account till May 21, 2021, shows that MSP is here and the propaganda against it will get exposed by the end of this marketing season.
“Modi Govt is sensitive towards the concerns of farmers and is taking steps to provide relief to the farming community in every possible manner to increase their income and offset the price rise,” said Agriculture minister Narendra Tomar.