With regard to the Fertiliser Industry, I have the following suggestions:

There is a need to increase the urea price by at least 15 per cent. The current
selling price of urea which is highly subsidised is almost one-fourth
the world price. There is a potential over the next four years to increase urea
price every year gradually so that the subsidy levels are reduced.

Further due to the product being very cheap, there is excessive use of urea
and this affects the soil. By increasing the price this can lead to more
balanced fertilization and lower subsidy outgo.

The Fertiliser industry is the best candidate for direct benefit transfer
(DBT). Currently, the subsidy is paid through the fertiliser companies.
This is totally unnecessary. If the farmers are given subsidy directly,
this will not only stop leakage but will also avoid unnecessary paper
work and red-tapism.

The current move of the Government to grant support to organic

compost is a welcome move as this ensures replacement of carbon
into the soil thereby making it more conducive for farming.

The major challenge in the farm sector relates to irrigation as the

percentage of land under irrigation is still less than 20-25per cent and
majority of Indian farmland is rain-fed or monsoon dependent.
Investment in linking of rivers and building of canals to systematically increase
irrigated area every year should be part of the budget.

Currently in the phosphatic sector, there is a cumbersome procedure to reclaim

subsidy and freight. It is desirable to have freight merged into the subsidy so that
there is only one stage of disbursement. A weighted average freight can be used
for this purpose. Currently, freight bills have to be submitted separately and
verified and then paid. All these results in a lot of paper work delay.

Single Super Phosphate (SSP) is the appropriate fertiliser for the small and
marginal farmers. The current system of subsidy is not conducive to promotion of
SSP usage. Countries like Brazil have used this cheaper alternative with some
support rather than depend on imported di-ammonium phosphate (DAP). The
whole policy towards SSP needs to be relooked. At least 3 million tons of SSP can
be used in addition to the current usage. This will bring down imports of DAP by
at least 2 million tons annually.