Fertiliser subsidy bill likely to dip 30-34% to Rs 1.8 lakh crore

2024-01-17 19:17:33

Government’s fertiliser subsidy bill is likely to decline 30-34% to ₹1.7-1.8 lakh crore this fiscal due to a reduction in global prices and lower imports of urea, said Mansukh Mandaviya, fertilizer minister, adding that the Red Sea tension will not affect fertilizer availability as India has enough stock.

“Subsidy is expected to be lower this year because of fall in global prices. We have not increased retail prices to reduce subsidy,” he said, adding that subsidy bill is estimated around ₹1.7-1.8 lakh crore.

Last year government’s subsidy burden rose as global prices skyrocketed due to Russia-Ukraine war.

Urea imports are estimated to be 40-50 lakh tonnes this fiscal, lower than last year’s 75 lakh tonnes as domestic production was higher. The use of nano liquid urea also helped, the minister said.

At present India has stocks of 70 lakh tonnes of urea, 20 lakh tonnes of DAP, 10 lakh tonnes of Muriate of Phosphate, 40 lakh tonnes of NPK and 20 lakh tonnes of Single Super Phosphate.

The geopolitical tension around the Bab-el-Mandeb Strait, a crucial sea route connecting the Red Sea and the Mediterranean Sea to the Indian Ocean has escalated due to attacks by Houthi militants, forcing ship to take a longer route around Cape of Good Hope pushing up fertilizer prices and shipping time.The minister said four urea plants have been revived and the fifth one will soon start production.

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