Source: The post is based on the article “House panel tells govt. to ensure fertilizer availability, increase local production” published in The Hindu on 9th August 2023.
What is the News?
The Standing Committee of Parliament on Chemicals and Fertilizers has posed questions on the availability of fertilizers and a subsidy policy.
What are the suggestions given by the Standing Committee of Parliament on Chemicals and Fertilizers?
Firstly, the committee has highlighted concerns about India’s reliance on imported fertilizers like urea, DAP, MOP, NPK, and others.
– The production of these fertilizers was 281.83 lakh metric tonnes but the consumption was higher at 401.46 LMT resulting in a deficit of 119.63 LMT which is worrisome.
Secondly, the committee wants the Department of Fertilizers to investigate fertilizer shortages in some states and ensure availability across all states.
– They suggest reviewing the nutrient-based subsidy (NBS) policy that currently excludes urea. This means that urea remains under price control whereas technically there is no price control in other fertilisers, causing disincentives for other fertilizers.
Thirdly, the committee also pointed out the discrepancy in GST rates, with fertilizers at 5% and raw materials like sulphuric acid and ammonia at 18%.
– They recommend lowering the GST on raw materials and including natural gas in the GST to avoid double taxation.
Fourthly, to counter international price fluctuations, the committee proposes purchase policy reforms and long-term import contracts for various fertilizers and raw materials.
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