IFFCO pitches for direct subsidy transfer

Says direct subsidy will empower them

Fertiliser major IFFCO has pitched for an overhaul of subsidy disbursement process in favour of direct payment to farmers instead of companies.

IFFCO Chairman and Managing Director U S Awasthi has said paying subsidy directly to farmers will empower them. He further said that though many fertliser companies are likely to oppose direct payment to peasants, he supports the idea.

At present, subsidy on fertilisers is paid directly to companies. After the soil nutrient is sold to farmers, companies generate bills that are to be paid within 45 days by the government.

The fertiliser subsidy is paid under four heads, subsidy on indigenous urea, imported urea, indigenous and imported P&K (phosphatic and potassic) fertilisers.

Urea is provided to farmers at a fixed subsidised MRP of Rs 5,360 a tonne. The difference between the cost of production or imported cost a and MRP is amount of the subsidy to manufacturers or importers.

Whereas phosphatic and potassic fertilisers is decontrolled as subsidy is fixed on these nutrients based on the ratio of nutrient in it.

“Present fertiliser subsidy system started 37 year back now farmers needs to be empowered by giving to them than industry. Let them make choice,” Awasthi said in his tweet.

Iffco requests the government to give fertiliser subsidy directly to farmers. Let industry compete to provide better nutrient and services to farmers, he added.

“I know a lot of producers will oppose direct transfer of fertiliser subsidy to farmers but iffco supports due to national farmers interest,” Awasthi said.

Earlier, Awasthi had also demanded decontrolling the urea.

Meanwhile, the Fertiliser Ministry has exhausted subsidy funds meant for indigenous urea manufacture, including banking arrangement of Rs 7,000 crore, and is looking for release of more funds in this budget.