NEW DELHI: On Wednesday, the Union cabinet, led by Prime Minister Narendra Modi, approved a provisional subsidy of ₹24,475.53 crore for nutrient-based phosphatic and potassic (P&K) fertilisers for the upcoming rabi (winter-sown) season. Additionally, the cabinet sanctioned new allocations for the Pradhan Mantri Annadata Aay Sanrakshan Abhiyan (PM-AASHA), a program designed to safeguard farmers’ incomes, according to Information and Broadcasting Minister Ashwini Vaishnaw.
The nutrient-based subsidy scheme provides farmers with fertilisers at prices lower than the market rate, based on their phosphatic and potassic content, with the aim of discouraging excessive use.
In India, the availability and affordability of essential fertilisers are vital for food security. These, combined with improved seeds, were instrumental in driving the Green Revolution of the 1960s.
The government offers 28 varieties of P&K fertilisers to farmers at subsidised rates through manufacturers and importers. Manufacturers sell the fertilisers at discounted prices and are later reimbursed by the government.
The cabinet also approved an allocation of ₹35,000 crore for PM-AASHA, a scheme that intervenes when market prices for farm produce plummet.
Launched in 2018, PM-AASHA includes three sub-schemes that allow state governments to purchase crops like pulses and oilseeds when market prices drop below the government’s set floor prices, protecting farmers from losses.
The cabinet-approved increase in funding for PM-AASHA will cover the entire 15th Finance Commission period, including the fiscal year 2025-26, as per a government statement.
The Union budget presented in July allocated ₹6,437 crore for PM-AASHA. In 2023-24 (revised estimates), the scheme received ₹2,200 crore, though the budget estimates initially allotted just ₹1 lakh, leaving farmers disappointed. In 2022-23, there were no funds allocated or spent on the scheme.
For greater efficiency, the government has merged two PM-AASHA sub-schemes: the Price Support Scheme (PSS) and the Price Stabilization Fund (PSF). “This consolidation will enhance implementation, ensuring farmers receive fair prices for their produce while controlling the price volatility of essential goods by maintaining availability,” an official stated.
