Nutrient Based Subsidy (NBS) Scheme

Nutrient Based Subsidy (NBS) Scheme

  • Under the scheme, a fixed amount of subsidy, based on the nutrient content present in them is provided on each grade of subsidized Phosphatic and Potassic (P&K) fertilizer except Urea.
  • It was expected that the NBS scheme will control farmers from applying too much urea containing only nitrogen.

Method of providing subsidies under Nutrient Based Subsidy (NBS) Scheme

    • In the case of non-urea fertilisers, MRP has been De-regularised and the government pays a flat per-tonne subsidy on the basis of nutrients mix in the fertiliser, to ensure they are priced at “reasonable levels”.
    • The per-tonne subsidy is currently Rs 10,231 for di-ammonium phosphate (DAP), Rs 6,070 for muriate of potash (MOP) and Rs 8,380 for the popular ‘10:26:26’ complex fertiliser, due to their mix of nutrients. That is why the decontrolled fertilisers price way above the Urea.

Process of claiming subsidy

    • Before 2018, fertiliser companies were receiving subsidies after their bagged material had been dispatched and received at a district’s railhead point or approved godown.
    • In 2018, Direct Benefit Transfer (DBT) system was introduced. Now, Fertiliser companies receive subsidies after the actual sales of fertilisers to farmers.
    • Around 2.3 lakh retailers all around the country have point-of-sale (PoS) machinery. PoS machines are linked to the Department of Fertilisers’ e-Urvarak DBT portal.
    • Anyone buying fertilisers has to provide their Aadhaar unique identity or Kisan Credit Card number. PoS devices will capture details like quantities of the individual fertilisers purchased, along with the buyer’s name and biometric authentication.
    • Now on the basis of this registered information on the e-Urvarak platform, a company can claim the subsidy.
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