Direct Subsidy to Farmers

The Government is considering the feasibility of giving subsidy directly to farmers. In this regard, a Task Force on direct subsidy in respect of Kerosene, LPG & Fertilizers has been set up under the chairmanship of Shri Nandan Nilekani, Chairman, Unique Identification Authority of India (UIDAI) to examine and recommend a implemental solution for transfer of subsidy directly to the intended beneficiaries. The Task Force, has given its Interim Report. In respect of fertilizers, the Task Force in its interim report has recommended a three stage approach with respect to payment of subsidy directly to farmers. Phase-I is to capture the information on availability of fertilizers at the farm gate level, wherein the availability at the retailer level will be captured. In Phase-II, which will be implemented after the Phase-I stabilizes, the subsidy is expected to be transferred at the last point sale and in Phase-III, the subsidy is expected to be transferred directly to the intended beneficiary based on AADHAR Numbers. The fertilizer subsidy is transferred to the farmer (including the marginal and small farmers) by way of a heavily subsidized MRP. As on date, a farmer pays only approximately 50% of the cost of fertilizer as MRP.

This information was given by the Minister of State for Chemicals and Fertilisers, Shri Srikant Kumar Jena in a written reply in the Rajya Sabha today.