GoM refers price revision of fertilisers to Cabinet

The Government is likely to revise the prices of fertilisers under the new nutrient-based subsidy regime starting next fiscal.

The Government is likely to revise the prices of fertilisers under the new nutrient-based subsidy regime starting next fiscal. The Group of Ministers (GoM) on fertilisers, which met on Tuesday, suggested four different pricing options while leaving the final decision to the Cabinet, sources said.

The GoM, headed by Agriculture Minister Sharad Pawar, meanwhile has given an in-principle approval for a uniform freight policy for fertiliser products, which will be applicable even to decontrolled fertilisers.

The decision is aimed at normalising the availability of all fertiliser products across far-flung areas of the country. While

the new freight policy would amount to an increase in the fertiliser subsidy bill, it will also reduce the price of decontrolled fertiliser products in remote areas. But the sources said the finer details of the policy will have to be worked out by the Fertiliser Department. Since the GoM has also recommended shifting from the existing product subsidy regime to the nutrient-based fertiliser subsidy regime, the GoM has given an in-principle approval to establish a regulatory body to look into the fertiliser pricing.

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Given the rising fertiliser consumption and increasing demand-supply mismatch, the sources said the GoM has also recommended floating of a special purpose vehicle (SPV) to make investments in fertiliser sector abroad to secure availability in the country.

The GoM is also learnt to have accorded an in-principle approval for bringing out a fertiliser policy, which will encourage private investment in the sector.