Why India needs a fresh fertilizer policy

Source: The post is based on the article “Why India needs a fresh fertilizer policy” published in Livemint on 19th January 2023.

What is the News?

Niti Aayog has set up a task force to examine the production and promotion of bio-fertilizer and organic fertilizers.

What are the steps taken by the government to improve the availability of fertilizers?

Some of the steps undertaken by the government to improve the availability of fertilizers include 1) Assessment of state-wise requirements every month, 2) 100% neem coating of urea which increases nutrient efficiency; monitoring of crop yield and soil health and 3) online monitoring of the movement of fertilizers through the integrated Fertilizer Monitoring System. 

The gap between demand and production was met through timely imports.

What is the impact of the current fertilizer policy?

Heavy subsidies have prompted many farmers to use chemical fertilizers like urea, which leads to higher productivity, but affects soil fertility in the long run. 

As per the UN report, excessive and inefficient use of fertilizers leads to nutrient losses to the environment and could also result in drinking water contamination and impact human lives as a result of unsafe storage practices. 

Also, with the subsidy being released directly to companies, technology-inefficient companies are being protected. 

What has been the trend in government expenditure on fertilizers?

The Ukraine war spiked the government’s spending on food, fertilizer and fuel subsidies by nearly 70%. 

For 2023-24, the fertilizer ministry might seek budgetary support of ₹2.5 trillion subsidy – outgo for FY23 has already crossed ₹2 trillion.

What steps has the Centre taken in 2022 for fertilizers?

The Department of Fertilizers has disbursed subsidies for urea and nutrient-based subsidy and implemented direct benefit transfer. 

It also implemented the ‘One Nation One Fertilizers’ scheme which aims to ensure timely supply of fertilizers.This eliminates the dilemma of choosing from the many brands available by introducing a single brand. 

The existing village, block/sub district/taluk and district-level fertilizer retail outlets are being converted into model fertilizer retail outlets.

What will the new policy on fertilizers seek to address?

The new policy could propose lower duty on imported phosphoric acid to raise the competitiveness of local fertilizer manufacturers and an incentive for promoting organic fertilizers.