Fertiliser Ministry will soon hold a meeting with the fertilizer firms selling phosphatic and potassic (P&K) fertilizers at higher prices and delaying reporting of their MRPs to the government. Under the nutrient based subsidy (NBS) scheme, fixed amount of subsidy is provided by the government on each grade of P&K fertilizers based on their nutrients content and companies have been allowed to fix maximum retail price (MRP) of subsidised P&K fertilisers at reasonable rates. P&K on non-urea fertilizers include complex NPK, DAP and MOP compounds.
Fertiliser companies are required to report the MRPs of their products to the government for monitoring of prices in order ensure that the MRPs fixed are reasonable. Fertiliser Ministry has reported that delays in reporting of MRPs by companies, practice of reporting higher MRPs and absence of a proper mechanism to cross verify their authenticity are causing difficulties in monitoring MRPs to find out the reasonableness of the P&K fertilizers prices. In the previous year, Ministry has issued notice to fertiliser companies to reduce the price following the fall of prices in the international market.
The Government has pegged subsidy provisioning at around Rs 68,000 crore for 2014-15 and has reduced potash subsidy by Rs 3.33 per kg. Meanwhile, the government has also notified that reduction in subsidy rates would not lead to an increase in retail prices of potash, as international market prices of potash have come down. Domestic farmers are presently using more nitrogenous fertilizers particularly urea as comparison to the P&K fertilizers because of their higher prices. Total domestic demand of both potash and phosphate stands at around 10 million tonnes per annum.
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