What are Nutrient Based Subsidy and City Compost Scheme? (Important) (Download PDF)


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Nutrient based Subsidy & City Compost Scheme has been approved beyond 12th Five year plan. Scheme was forwarded by Department of Fertilizers. Expense will be on actual basis since national roll out of DBT lead to 100 % payment of subsidy to fertilizer companies.

Image of Cabinet Committee on Economic Affairs

Image of Cabinet Committee on Economic Affairs

Image of Cabinet Committee on Economic Affairs

  • Subsidy on P&K fertilizes & MDA will be provided on subsidy rates.

  • MDA was launched in 2016, is being governed by City Compost Scheme.

  • Continuation of Scheme will ensure that adequate quantity of P&K is made available to farmers at statutory controlled price.

  • Govt. is making available fertilizers namely Urea & 21 grades of P&K fertlizers.

Department of Fertilizer

  • DoF is to ensure smooth & timely availability of fertilizers in adequate quantity to farmers.

  • Govt. has implemented NBS for decontrolled Phosphatic & Potassic fertilizer w/view to promote balanced fertilization.

  • Main functions of DoF include planning, promotion & development of Fertilizers Industry.

  • Vision of DoF is to achieving fertilizer security for country for sustainable growth.

What is Nutrient Based Subsidy?

  • Government of India implemented Nutrient Based Subsidy (NBS) policy w. e. f. 1st April 2010. The notable features of this scheme are as follows:

  • This scheme is for 22 grades of decontrolled fertilizers namely DAP, MAP, TSP, DAP Lite, MOP, SSP, Ammonium Sulphate and 15 grades of complex fertilizers.

  • Fertilizers are provided at the subsidized rates based on the nutrients (N, P, K & S) contained in these fertilizers.

  • Additional subsidy is provided for fertilizers fortified with secondary and micronutrients as per the Fertilizer Control Order such as Boron and Zinc.

  • Subsidy is given to the companies based on nutrients content (i. e. Nitrogen, Phosphate, Potash and Sulphur).

  • Maximum Retail Price (MRP) of fertilizers is left open with manufacturers/marketers allowed to fix the MRP at reasonable level.

What Are the Problems of the NBS Scheme?

  • Scheme should have fostered balanced use of the fertilizers to improve soil health and reduce government outgo on fertiliser support.

  • Policy failed to achieve the first objective of improving the soil health as the prices are skewed towards low prices of Urea.

What is City Compost Scheme?

  • City Compost Scheme aims to convert all organic waste generated in cities into compost or biogas and market the compost with the help of fertiliser companies to benefit farmers.

- Published/Last Modified on: June 1, 2018

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