The Centre on Wednesday decided to increase the subsidy for Di-ammonium Phosphate (DAP) fertiliser from Rs 500 per bag to Rs 1,200 per bag.
The decision was taken in a high-level meeting chaired by Prime Minister Narendra Modi on the issue of fertiliser prices.
"A historic decision was taken to increase the subsidy for DAP fertiliser from Rs 500 per bag to Rs 1,200 per bag, which is an increase of 140 per cent. Thus, despite the rise in international market prices of DAP, it has been decided to continue selling it at the older price of Rs 1,200 and the Central government has decided to bear all the burden of the price hike. The amount of subsidy per bag has never been increased so much at once," read an official release.
"Last year, the actual price of DAP was Rs 1,700 per bag. In which the Central government was giving a subsidy of Rs 500 per bag. So the companies were selling fertiliser to farmers for Rs 1200 per bag," it added.
It was discussed in the meeting that the price of fertilisers is undergoing an increase due to the rising prices of phosphoric acid, ammonia etc., internationally.
However, Prime Minister Narendra Modi stressed that farmers should get fertilisers at old rates despite the international hike in prices.
PM Modi further remarked that the government is committed to the welfare of farmers and will take all efforts to ensure that farmers do not have to face the brunt of price-rise.
"With the increase in subsidy in DAP, the Centre will spend an additional Rs 14,775 crore as subsidy in Kharif season," read the release.
Recently, the international prices of phosphoric acid, ammonia etc., used in DAP, have gone up by 60 per cent to 70 per cent.
( With inputs from ANI )
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