Nutrient-Based Subsidy

Why in the News?

The Cabinet Committee on Economic Affairs approved nutrient-based subsidy (NBS) for phosphatic & potassic fertilizers for the rabi season.

Key Points:

About

Nutrient Based Subsidy

• Under it, a fixed rate of subsidy (in ₹per Kg basis) is announced on nutrients namely Nitrogen (N), Phosphate (P), Potash (K), and Sulphur (S) on annual basis.
• Nodal Ministry: Ministry of Chemicals & Fertilizers.
• Aim: To ensure that fertilizers remain available at an affordable price for farmers.

Issue

• Subsidy on fertilizers encourages their use which in turn decreases soil fertility.

Significance

• NBS absorbs the fluctuations in the international prices of fertilizers and raw materials.