Union agriculture minister Shivraj Singh Chouhan on Wednesday strongly pitched for transferring the country’s ₹1.71 lakh-core fertiliser subsidy directly to farmers’ bank accounts, instead of routing it through crop-nutrient manufacturers, hinting that discussions were on to arrive at a consensus on how to initiate the reform.
The government has linked nearly 80.5 million farmers with the biometric Aadhaar-based digital IDs as part of the ministry’s Agristack platform, which would help facilitate targeted delivery of all kinds of direct benefit transfers, the minister said, addressing farmers at Krishi Vigyan Mela, the government’s annual farm science fair, in the national capital.
“We have to take many decisions through consensus. One such issue is fertilizer subsidy. It’s a huge subsidy. Now we have to review this…because we often get complaints. Farmers don’t receive full benefits and there is diversion (of fertilizers),” Chouhan said.
Food security in the world’s most populous nation is closely linked to timely availability of fertilisers, bulk of which India imports to meet domestic requirements. The government subsidizes a range of crop nutrients to farmers through manufacturers and importers, who sell them at a discount to cultivators through point-of-sale devices. These companies are then reimbursed by the government through the fertilizer subsidy bill.
“Subsidised fertilizers are meant for farmers but they get diverted to other users…to factories and elsewhere. The nation should now think whether fertiliser subsidy should be directly transferred to bank accounts of farmers,” the minister said.
According to a 2020 report by the National Academy of Agricultural Sciences (NAAS), direct benefit transfer in the case of fertilisers opens up the “possibility of linking Soil Health Card (SHC) data with DBT for optimal use of nutrients, hence a saving of subsidy”.
Digital IDs of farmers had made direct transfers very efficient, according to the minister. This includes benefits related to PM-Kisan, under which landed-owning cultivators are paid ₹6000 a year, he said.
The agriculture ministry is examining data generated through the Agristack platform and digital IDs of 80.5 million farmers to devise a policy proposal to move towards cash payment of crop-nutrient subsidy directly to farmers, an official separately said.
The AgriStack platform consists of three databases, namely, a national farmers’ registry, geo-referenced village maps, and crop-sown registry, all maintained by the Centre and state governments as a single source of farmers’ details. “Such detailed information will help estimate localized fertilizer usage patterns,” the official said.
The NAAS report, however, point to several implementational challenges. “Fertilizer consumption varies widely across states and may not have a definite trend matching the gross cropped area,” it had said.
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