Centre's urea bag trick to save 6,000-7,000cr subsidy annually
TNN | Updated: Jun 4, 2017, 02:50 ISTNEW DELHI: The government has found an innovative solution to cut urea consumption, which can help it save about 6,000-7,000 crore subsidy annually.
In the next six months, all urea bags will be available only in 45kg instead of 50kg. The fertilizer ministry believes this will result in farmers using two bags weighing 90kg against the current practice of using two bags, which weigh 100 kg and this will lead to a significant change in the consumption pattern and also lead to sharp decline in costly urea imports. The government has set aside 14,000 crore for urea import in 2017-18. "The decision has been taken and the process to roll this out has started. Usually farmers calculate how much urea they need for one acre farm land in terms of bags. So, by reducing five kg in each bag, we will see 10% fall in consumption. Moreover, 45kg of neem coated urea is equivalent to normal 50 kg bag," said Dharampal, joint secretary (fertilizer). The reason is that there will be less wastage.
The government has budgeted 70,000 crore for fertilizer subsidy in the current financial year and is seeking several solutions to reduce the enormous burden on the exchequer. Sources said a recent analysis done by the agriculture ministry has indicated how use of urea per acre has gone down by 4-6%. The trend of farmers using excess quantity of urea has become a concern considering its adverse impact on soil health.
Officials said the overall decrease in urea consumption could also be because of 100% neem coating of the soil nutrient. "This single decision has stopped diversion of the highly subsidised urea for industrial activities," said an official. Though India set a record of producing 24.2 million tonnes of urea in 2016-17, it had to import around eight million tonnes to meet the domestic demand. The government has already started work on reviving closed urea manufacturing plants to ramp up production by 2022 so that there is no need to import the fertilizer. "We will have surplus production and can explore possibility of export urea to our neighbouring countries such as Nepal, Bangladesh and Sri Lanka," a ministry official said.
In the next six months, all urea bags will be available only in 45kg instead of 50kg. The fertilizer ministry believes this will result in farmers using two bags weighing 90kg against the current practice of using two bags, which weigh 100 kg and this will lead to a significant change in the consumption pattern and also lead to sharp decline in costly urea imports. The government has set aside 14,000 crore for urea import in 2017-18. "The decision has been taken and the process to roll this out has started. Usually farmers calculate how much urea they need for one acre farm land in terms of bags. So, by reducing five kg in each bag, we will see 10% fall in consumption. Moreover, 45kg of neem coated urea is equivalent to normal 50 kg bag," said Dharampal, joint secretary (fertilizer). The reason is that there will be less wastage.
The government has budgeted 70,000 crore for fertilizer subsidy in the current financial year and is seeking several solutions to reduce the enormous burden on the exchequer. Sources said a recent analysis done by the agriculture ministry has indicated how use of urea per acre has gone down by 4-6%. The trend of farmers using excess quantity of urea has become a concern considering its adverse impact on soil health.
Officials said the overall decrease in urea consumption could also be because of 100% neem coating of the soil nutrient. "This single decision has stopped diversion of the highly subsidised urea for industrial activities," said an official. Though India set a record of producing 24.2 million tonnes of urea in 2016-17, it had to import around eight million tonnes to meet the domestic demand. The government has already started work on reviving closed urea manufacturing plants to ramp up production by 2022 so that there is no need to import the fertilizer. "We will have surplus production and can explore possibility of export urea to our neighbouring countries such as Nepal, Bangladesh and Sri Lanka," a ministry official said.