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Scrutiny
  
Subsi-died
The faulty delivery mechanism
17/05/2007

Finance Minister in this budget offered Rs. 224.5 billion as fertiliser subsidy in the hope that this money would pass on to needy people. It is very evident that the underline motive behind this subsidy is to lower the cost of cultivation. Contrarily the NSSO survey reveals that the cost exceeds agricultural income due to the faulty subsidy regime. Farmers suffer due to inefficient and faulty delivery mechanism, which only benefits the babus and corporates. Even the fertiliser composition available in India is not as per the requirement of the soil. Indian soil demands fertiliser with NPK (nitrogen-phosphorous-potassium) ratio of 4:2:1, but the skewed subsidy policies have ensured that the nitrogenous fertilisers remain cheap while the rest remain costly.

The result of the anomaly has been that the NPK ratio has moved heavily towards high nitrogen ratio for the soil. Also the non-availability of smaller bags has resulted in helping only large farmers and not the small and marginal ones.

By:- B&E
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