The Government of India has ensured the smooth availability of fertilizers at affordable prices for farmers, despite recent geopolitical challenges such as the Russia-Ukraine conflict. To achieve this, special and additional packages were provided over and above the Nutrient-Based Subsidy (NBS) rates during Rabi 2021-22, Kharif 2022, Rabi 2022-23, and Kharif & Rabi 2024 seasons.
Urea is made available to farmers at a statutorily notified Maximum Retail Price (MRP), irrespective of production costs. A 45-kg bag of subsidized urea is priced at ₹242 (excluding neem coating and applicable taxes). The difference between the delivered cost of urea at the farm gate and the net market realization by manufacturers is reimbursed as a subsidy by the Government of India. This ensures that farmers receive urea at affordable rates across the country.
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The Government implemented the Nutrient-Based Subsidy (NBS) policy on April 1, 2010, for phosphatic and potassic (P&K) fertilizers. Under this policy, subsidies are determined based on the nutrient content of the fertilizers, including nitrogen (N), phosphorus (P), potassium (K), and sulfur (S). The Government monitors international prices of fertilizers and raw materials and adjusts NBS rates annually or biannually to account for fluctuations.
To maintain price stability in the fertilizer market, the Government provided additional packages above the NBS rates. These measures ensured that the Maximum Retail Prices (MRP) of fertilizers remained stable, shielding farmers from market volatility. Special packages were implemented from Rabi 2021-22 to Kharif and Rabi 2024 to sustain affordability.
Long-Term Agreements with Resource-Rich Nations: To diversify its sources and ensure an uninterrupted supply of fertilizers, the Government promotes long-term agreements between Indian fertilizer companies and suppliers from resource-rich countries. These agreements facilitate the import of fertilizers, intermediates, and raw materials to meet India’s agricultural needs.
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