Friday, September 24, 2010

govt told to slash urea subsidy

25 Sept 2010


By Delhi Correspondent

NEW DELHI: A new fertiliser policy is on the anvil, based on a report of a committee on "Optimisation of Fertiliser Usage" that has recommended reduction in subsidy on urea, bringing it under the free pricing regime sooner than later and allowing a higher price to discourage its unproductive use.

Instead, farmers can be assisted by providing higher level of subsidies on other critical nutrients (fertilisers) like Sulphur, Zinc and Boron to make them affordable, says the 80-page committee report submitted by its chairman T Nanda Kumar, a retired agriculture secretary, to the Cabinet Secretary here on Friday.

The committee, which also included secretaries, agriculture, fertiliser, finance and expenditure, has also recommended that the government move towards free pricing of fertilisers and finally to "direct cash transfer to farmers." It also laid stress on quality controls and soil testing instead of relying on outdated data.

PORT MECHANISATION: It laid special emphasis on the fertiliser stocks reaching well in advance instead of the current practice of a "ship-to-farm" operation at the beginning of the season. It pointed out how every activity through the supply chain, starting with handling and bagging facilities at the ports, creates inefficient logistics that help the black-market since farmers do not wait for stocks to arrive just in time. It said handling and bagging operations in all ports should be mechanised on a priority basis.

To optimise the use and efficiency of fertiliser use and to increase productivity of crops in India, the committee has suggested a shift to Site Specific Nutrient Management (SSNM), including integrated and balanced fertiliser management.

"It is difficult to effect the change all over the country in a short time," the committee said while recommending that it may, therefore, be taken up first in 100 districts which consume 50 per cent NPK fertiliser, followed by the districts that have major soil nutrient problems because of soil degradation. It says the proposed SSNM should include NPK, secondary and micro nutrients and soil ameliorants. Addition of farm yard manure and biofertiliers should also be an integral part of it.

It suggests that the district agricultural plans should include an SSNM plan drawn up with technical support and fertiliser demand should be assessed on the basis of districtwise demand, taking into account soil fertility, irrigation and crop/seed characterstics.

HANDICAP: The committee also noted that reservation of manufacture of micro nutrients for SSI (small scale industries) is a major constraint in expanding their use. It suggested subsidy for plants set up to convert urban and rural waste into manure.

Other recommendations of the committee which will be used by the government to formulate a new fertiliser policy are:

--- Set up more soil testing laboratories in the PPP (public-private partnership);

-- Place in public domain 4.5 to 5 lakh soil samples tested by the fertiliser companies and integrate them with the ICAR (Indian Council of Agriculture Research) data;

-- Promote use of fortified fertilisers that will reduce farmers' costs and add to productivity;

-- Reduce dependence on import of substantial quantity of fertilisers by developing own resources;

-- Produce SSP 'Lite" with 14% P2O5, making use of indigenous rock phosphate;

-- Use industrial byproducts of certain industries as soil ameliorants alike paper mill sludge used effectively in Orissa;

-- Monitor quality of fertilisers through independent quality control laboratories;

-- Encourage change in current farming practices to encourage in-situ conservation of moisture and nutrients; and

-- Adequate stocking of fertilisers by the state agencies as private traders avoid incurring the cost of inventory.


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