Union Agriculture and Rural Development Minister Shivraj Singh Chouhan was addressing the farmers on the occasion of the inauguration of the Pusa Agricultural Science Fair at the Indian Agricultural Research Institute Fair Ground, Pusa Complex in New Delhi on Wednesday. Photo Courtesy: Shiv Kumar Pushpakar
Union Agriculture Minister Shivraj Singh Chouhan has put his emphasis on the long discussed proposal to transfer fertilizer subsidy directly to the bank accounts of farmers. Saying it “can be done, it is possible,” he directed officials to begin designing a functional mechanism for the transition.
Inaugurating the annual farmers’ fair organized by the Indian Agricultural Research Institute (IARI) in New Delhi on Wednesday, Chouhan said: “There is a need to reform this area (fertilizer subsidy). Currently it is over ₹1.70 lakh crore that goes to companies, which can be distributed directly to farmers. I think it is possible, can be done.”
Highlighting that urea bag is available at ₹266/bag (of 45 kg) and D-ammonium phosphate (DAP) at ₹1,350/bag (of 50 kg), he asked farmers, ICAR staff and others to estimate the market rates of these fertilizers and said the Center has paid subsidies worth over ₹1.70 lakh crore to farmers to get fertilizers at cheaper rates.
As per the policy, while urea is completely controlled by the government, companies have to fix the MRP of other fertilizers after incorporating fixed subsidies on nitrogen (N), phosphorus (P), potash (K) and sulfur (S), which are announced twice every year before the Kharif and Rabi sowing seasons.
Currently, the subsidy is fixed at ₹43.02 per kg for N, ₹47.96 per kg for P, ₹2.38 per kg for K and ₹2.87 per kg for S.
The minister said that complaints have been received from many areas that despite such huge supply and huge subsidy, farmers did not get fertilizer. At some places, the subsidized urea given to farmers also got wasted.
“The country should think whether fertilizer subsidy should be transferred directly to the bank accounts of farmers,” Chouhan said.
Asking ministry officials to consider his suggestion and seeking ICAR’s support, the minister said there is a need to build consensus, and “let the debate happen”. “We have to find a mechanism (on fertilizer DBT),” he said.
Addressing an event on soil health organized by think tank ICRIER last month, NITI Aayog member Ramesh Chand had said that though he has been pushing for direct benefit transfer of fertilizer subsidies from time to time, the issue is very complex and there is no specific solution. “When I told a group of farmer leaders that if DBT is implemented, farmers will have to pay more than ₹2,000 to buy a bag of urea, not the current ₹267, they never demanded it after that.”
According to an official study, it was found that 65 percent of the farmers in the country had purchased 5-7 bags of urea throughout the year during 2024-25. But, 163 out of 330 districts where the fertilizer is used were found to be consuming 22 lakh bags of urea or 1 lakh tonne (litre) to 1.8 litres, each.
In the current financial year, the subsidy on P&K was ₹49,000 crore in BE phase, which has increased to ₹60,000 crore in RE. The subsidy allocation for P&K, from where India is more than 90 per cent dependent on imports, has been reduced to ₹54,000 crore.
Published on February 25, 2026
