Fertiliser subsidies, though critical for ensuring farmers’ welfare, have emerged as a major source of fiscal stress and import dependency. Critically examine the issues associated with India’s fertiliser sector.

Answer: Model Answer approach

The inquiry concerns the problems facing the fertilizer industry in India, and we must talk about ONOF’s contribution to offering a workable solution.

Overview: Jot down the data and current situation regarding fertilizer subsidies in India, along with a brief explanation of the ONOF program.

• By introducing One Nation One Fertilizer (ONOF) under the fertilizer subsidy program known as “PM-Bhartiya Jan Urvarak Pariyojna” (PMBJP), the Center further seeks to rationalize the fertilizer sector after reducing fertilizer subsidies by 6% in Budget 2024–2025.

Body: List the problems facing the fertilizer industry in India. One Nation, One Fertilizer (ONOF) benefits. However, ONOF has certain problems.

Problems in the Fertilizer Industry in India: 

• 30% of India’s urea needs are met by imports each year, with China emerging as the country’s second-largest supplier in 2022–2023. The steep increase in global energy prices and supply shortages in key producing nations brought on by strong local demand, output reductions, and export limitations are the causes of price increases in the fertilizer business.
• The Government of India has increased fertilizer subsidies to help farmers lessen the hardship caused by rising input prices. The government’s fertilizer subsidy bill, which was worth ₹2 lakh crore in 2022–2023, was second only to the food subsidy in terms of spending, placing a significant strain on fiscal consolidation.

In summary: Provide a path ahead.

• Therefore, it can be said that in order to accomplish the goal of “Self-Sufficient” India as a subcomponent of Viksit Bharat by 2047, the Indian fertilizer sector needs a structural overhaul by fostering organic farming, developing indigenous capability, and modifying nano urea and ONOF to further enhance.

Practice Question

Question: What are the potential benefits and challenges of the PM- Bhartiya Jan Urvarak Pariyojna (PMBJP) scheme? Suggest reforms needed to make India self-sufficient in fertiliser production by 2047. (250 words)

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