The govt increased the benchmark prices of imported di-ammonium phosphate (DAP) and muriate of potash (MoP) fertiliser for the fiscal to ensure uninterrupted availability in the country during the coming kharif sowing season.The decision was approved in a meeting of the Cabinet Committee on Economic Affairs (CCEA) in New Delhi on Thursday.However, the CCEA also gave freedom to fertiliser companies to raise retail prices of DAP by up to Rs 600 per tonne from the existing rate of Rs 10,750 per tonne.The government reimburses subsidy on these two nutrients to fertiliser companies based on the benchmark price.
The benchmark price has been increased to USD 612/tonne for DAP and USD 420/tonne for MOP from the current level of USD 580/tonne and USD 390/tonne, respectively.
The Group of Ministers headed by Finance Minister Pranab Mukherjee had decided in February that the government will shoulder an additional fertiliser subsidy burden in the wake of rising global fertiliser prices.
India imports six million tonnes of DAP and four million tonnes of MoP every year.
"This (revision in benchmark prices) will enable the manufacturers and importers to import fertiliser and fertiliser inputs and undertake domestic production and make fertiliser available to the farmers in 2011-12," an official statement said.
Farmers would be able to buy fertilisers at subsidised rates at the maximum retail price (MRP), he added.
The budgetary provision for phosphatic and potassic fertilisers for the 2011-12 fiscal is Rs 33,500 crore.
However, the total subsidy outgo on potassium and phosphatic fertilisers for the ongoing fiscal will depend on the overall sale of the fertilisers, it added.
Courtesy : The Hindu
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