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Cabinet approves ₹28,655 crore fertilizer subsidy for rabi season

It will offset hike in global rates of DAP, nitrogen, phosphate and potassic fertilizers

October 12, 2021 10:41 pm | Updated 10:41 pm IST - NEW DELHI

Photo used for representative purpose only.

Photo used for representative purpose only.

The Centre has approved an additional fertilizer subsidy of ₹28,655 crore for the rabi or winter planting season, which runs from October 2021 to March 2022. The Cabinet Committee on Economic Affairs approved the new nutrient-based subsidy rates for phosphatic and potassic fertilisers on Tuesday.

Unlike urea where the Centre sets a fixed maximum retail price, non-urea fertilizer prices are decontrolled with the Government fixing nutrient-based subsidy rates instead. The subsidy is paid to fertilizer companies as compensation for selling their products to farmers below market prices.

Thus, the price a farmer pays for a 50-kg bag of di-ammonium phosphate (DAP), the most popular fertilizer after urea, will continue to remain at ₹1,200. The increased subsidy will offset the hike in global rates of DAP, nitrogen, phosphate and potassic fertilizers.

In April, fertilizer companies faced with a surge in international prices hiked their DAP prices to ₹1,900 per bag, spurring a backlash from outraged farmers coping with increased input costs before the kharif or monsoon planting season. The CCEA had then approved a proposal to hike subsidy rates by 140% in May, emphasising that it was a one-time measure as part of COVID relief.

Nod for AMRUT 2.0, SBM-U 2.0

The Cabinet also approved the ₹2.77-lakh crore Atal Mission for Rejuvenation and Urban Transformation (AMRUT) 2.0 and the ₹1.41-lakh crore Swachh Bharat Mission-Urban 2.0 — both of which were launched by Prime Minister Narendra Modi on October 1.

Under the second phase of AMRUT, the Housing and Urban Affairs Ministry proposed universal water supply in all 4,378 statutory towns, an increase from the 500 cities covered in AMRUT 1.0. The Government said the outlay for the scheme would be ₹2,77,000 crore, including the Central share of ₹76,760 crore, for five years from 2021-2022.

Also approved till 2025-2026, the SBM-U 2.0 would have an outlay of ₹1,41,600 crore. The sanitation mission would aim to eliminate open defecation in all cities with less than 1 lakh population.

100 affiliated Sainik schools

The Cabinet also gave green signal to a proposal to affiliate 100 government and private schools with the Sainik School Society, run by the Defence Ministry. They will admit 5,000 students in Class 6 from the next academic year 2022-23.

Finance Minister Nirmala Sitharaman had previously announced the plan to set up 100 Sainik schools in her Budget speech in February.

There are 33 Sainik Schools which have a capacity of about 3,000 students in Class 6, according to an official statement. They are run as joint ventures with the respective State Governments, who provide land and infrastructure and are meant to prepare students academically, physically and mentally for entry into the Defence forces.

The 100 new affiliated schools will “function as an exclusive vertical which will be distinct and different from existing Sainik Schools of MoD. In the first phase, 100 affiliate partners are proposed to be drawn from States, NGOs and private partners,” the statement said.

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