Government will provide fertilizer subsidy directly to farmers



The government decided to pay a fertilizer subsidy directly to farmers through the Ministry of National Food Security and provincial governments in an effort to reduce prices, which have soared and led to consumption below requirements.

Di-ammonium phosphate (DAP) prices have risen above 10,000 rupees per bag, dealing a blow to farmers.

In order to put an end to market manipulation by fertilizer dealers, who were allegedly involved in black market and profiteering, the government decided to register them.

The previous government had also urged the fertilizer industry to blacklist dealers involved in the black market.

Seeking to address issues related to fertilizer supply during the current Kharif planting season, the Fertilizer Review Committee met on Wednesday under the chairmanship of Federal Minister of Industries and Production Makhdoom Syed Murtaza Mahmud.

Early in the deliberations, agriculture departments revealed that there had been a 14% drop in DAP offtake during the last planting season due to high prices, meaning crops received less application of the phosphate component of fertilizers, seriously affecting production.

The committee heard that there was an urgent need to provide balanced nutrients to prepare the soil for crops and higher grain production.

Considering the price difference between urea and DAP, the Minister of Industry said that the government has decided to provide subsidies directly to farmers immediately through the Ministry of National Food Security and Governments provincial governments, so that DAP prices can be reduced.

“This step will also ensure a balanced application of nitrogen and phosphate fertilizer to the soil,” he said.

The minister stressed that the government would discourage “compulsive buying of DAP by farmers along with urea”.

The committee discussed national fertilizer production and demand as well as prices, subsidy scheme and fertilizer monitoring and verification mechanism for the Kharif season in the context of the Prime Minister’s meeting on fertilizer.

At Tuesday’s rally, the prime minister endorsed various policy measures to ensure availability of fertilizer at affordable prices for farmers during the Kharif season.

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The committee noted that unregistered fertilizer dealers would be subject to the verification mechanism and that it had been necessary for the dealers to be registered with the respective provincial departments to ensure a steady supply of fertilizer at the district level.

Fertilizer manufacturers assured the government that dealers would be registered with relevant provincial departments.

In order to combat hoarding and smuggling, the government decided to set up a task force under the Ministry of the Interior and composed of law enforcement agencies, the Federal Board of Revenue and provincial departments to thwart illegal cross-border movements of urea.

The minister said that the government has prepared to implement the vehicle registration, tracking and verification system to ensure adequate and timely supply of key soil nutrients to farmers during the Kharif season. .

Commenting on the recent rise in urea prices, the Minister pointed out that the government would not tolerate the unjustified increase in urea prices.

He added that the government was restoring the price of urea to the old level of Rs 1,768 per bag to relieve farmers. “Any justified price increases will be notified later by the government after consultation with the industry,” he said.

The Minister assured the industry that the government would address the issues related to the industry’s overdue payments.

“The government has restored the gas supply to the fertilizer factories in accordance with the agreement and they will continue to receive an uninterrupted supply of gas for domestic production to support farmers and the country’s agricultural base.”

Participants in the meeting included representatives from the fertilizer manufacturing industry, dealers, the Chief Secretary of Punjab and secretaries from provincial agriculture departments.

Federal Secretary for Industries and Production Jawwad Rafique Malik and senior ministry officials attended the meeting.

Published in L’Express Tribune, May 12and2022.

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