Government of India has been effectively implementing the Direct Benefit Transfer (DBT) system to ensure timely and affordable access to fertilizers for farmers. Under this initiative, Point-of-Sale (PoS) machines have been installed at every retail fertilizer outlet across the country. These machines authenticate the buyer’s identity using Aadhaar and facilitate real-time fertilizer sales, while 100% subsidy is directly credited to fertilizer companies.
Urea is being supplied to farmers at the government-notified Maximum Retail Price (MRP). A 45 kg bag of urea is priced at ₹242 (excluding neem coating charges and applicable taxes). The Government bears the difference between the actual cost of delivery at the farm gate and the net market realization by manufacturers/importers, ensuring that all farmers—regardless of their size receive urea at a uniform subsidized rate.
Between 2022–23 and 2025–26 (up to July 21, 2025), the Government has allocated a total of ₹6,76,678.77 crore as fertilizer subsidy. This includes subsidies on both domestically produced and imported urea, as well as Phosphatic and Potassic (P&K) fertilizers.
| Financial Year | Total Subsidy (₹ crore) |
| 2022–23 | ₹2,54,798.88 |
| 2023–24 | ₹1,95,420.51 |
| 2024–25 | ₹1,77,129.50 |
| 2025–26* | ₹49,329.88 (up to July 21) |
| Grand Total | ₹6,76,678.77 |
Nutrient-Based Subsidy Policy for P&K Fertilizers:
Since April 1, 2010, the Government has been implementing the Nutrient-Based Subsidy (NBS) policy for P&K fertilizers. Under this policy, annual subsidy rates are fixed based on the nutrient content of fertilizers. Companies are allowed to set MRP based on market conditions, while the Government monitors the pricing to ensure fair rates for farmers.
Inclusive and Transparent Fertilizer Distribution:
The DBT system does not restrict fertilizer access to any specific beneficiary. Any farmer small, marginal, or large can purchase subsidized fertilizers from any authorized outlet after Aadhaar authentication. This transparent mechanism ensures that every farmer benefits equally from the subsidy without any form of exclusion.
Read More- Subsidy on Urea, Phosphatic, and Potassic Fertilizers
