Govt to clear fertiliser subsidy arrears of Rs 100 bn by March: Gowda

Fertiliser subsidy arrears to the industry have come down by 75 per cent to Rs 100 billion in the last four years and the outstanding amount is expected to be cleared by the end of this fiscal year, Chemicals and Fertilisers Minister Sadananda Gowda said Wednesday.

The government will also not raise the minimum retail price (MRP) of urea to protect farmers interest, he said.

Addressing the annual general meeting of the Fertiliser Association of India (FAI), Gowda said the direct benefit transfer (DBT) scheme in the fertiliser sector has been a great success as 55 million tonnes of nutrients have been sold to 138 million farmers through around 200,000 PoS machines.

"From Rs 400 billion during UPA time, the fertiliser subsidy arrears have now come down to about Rs 100 billion only. We plan to clear this amount also soon," he told reporters here on the sidelines of the event.

When asked about the industry's claim that arrear amount is more than Rs 200 billion, Gowda asserted that the outstanding is only around Rs 100 billion.

Urea and potassium and phosphatic (P&K) fertilisers are being sold to farmers at a highly subsidised prices to farmers. The difference between the MRP and the cost of production is reimbursed to the fertiliser manufacturers by the government.

Gowda assured the industry that the government would try to address all the issues raised by the industry expeditiously.

On DBT, he said that in spite of technical glitches, the programme has been implemented successfully.

The minister said the government's effort is to balance the interest of farmers and the industry.

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