Ministry, industry join hands to seek subsidy for sulphur

Ministry, industry join hands to seek subsidy for sulphur

New Delhi: The Union fertilizer ministry and the fertilizer industry want sulphur to be included in the new nutrient-based subsidy regime that is being considered because soil in most parts of the country lacks this chemical.

The ministry will pitch this to the group of ministers (GoM) which will decide on the new fertilizer policy. The group is likely to meet on Wednesday.

“We will pitch for sulphur to be included in the subsidy regime. This time we wanted to come up with a long-term policy and we wanted to take the manufacturers on board before presenting a comprehensive proposal before the GoM," said a senior fertilizer ministry official who did not wish to be identified.

Currently, the government subsidizes certain fertilizers, and not nutrients. The subsidized fertilizers contain only the primary soil nutrients namely nitrogen (N), phosphorus (P) and potassium (K). Experts claim that the government’s subsidy regime has not only led to an overuse of the primary nutrients but has also resulted in gross neglect of the secondary and micronutrients such as sulphur, zinc and boron.

“Today, sulphur is the fourth most important plant nutrient after N, P and K. At the start of the green revolution in India there was enough sulphur in the soil. However, since then, extensive cultivation has led to sulphur deficit and lack of government subsidy has resulted in reduced replenishment. In fact, sulphur deficiency is now holding back the effectiveness of the primary nutrients, N, P and K," said R.C. Gupta, deputy director general of the Fertilizer Association of India (FAI), an industry body.

The use of fertilizers has upped foodgrain productivity from 644kg/hectare in 1966-67 to 1,700kg/ha in 2007-08. However, much of these gains were made in the 1970s, 1980s, and 1990s. In the past decade, foodgrain productivity has remained constant despite a 40% increase in fertilizer use.

The nutrient-based subsidy scheme could address this skewed usage.

“The crucial thing for the GoM to decide is the rate at which each per unit of the different nutrients will be subsidized because if the market prices of the subsidized fertilizers are not increased then after the inclusion of sulphur the government’s subsidy outgo could possibly increase," said the official at the fertilizer ministry. The government’s fertilizer subsidy bill has grown from Rs15,879 crore in 2004-05 to an estimated Rs48,000 crore in 2007-08.

If the nutrient-based scheme is accepted by the GoM, fertilizer companies will be able to provide farmers different fertilizer products customized to suit the soil requirements in various parts of the country.

“Sulphur plays a crucial role in increasing the yield of pulses and oilseeds, both of which are points of concern for the government. There are some subsidized fertilizer products ...which can be produced both with and without sulphur. But since the government does not subsidize the cost of adding sulphur, most manufacturers do not add it," said Gupta.

Pulses production has actually gone down from 13.4 million tonnes (mt) in 1999-00 to 13.1mt in 2005-06. And import of oilseeds has increased from Rs1.34 crore in 2001-02 to Rs47.24 crore in 2005-06 although the domestic production increased from 20.6mt to 27.7mt over the same period.

The fertilizer ministry will also try and get the GoM to look at the new fertilizer investment policy that seeks to increase domestic manufacturing capacity for fertilizers. This, though, was not supposed to be looked at by the GoM.

The GoM is also expected to formally approve the introduction of fortified or value-added fertilizers within the subsidy regime. However, the cost of fortification will not be subsidized and will have to be borne by the farmer (reported by Mint on 5 October).

The GoM, headed by agriculture minister Sharad Pawar, is looking into issues such as the sustainable use of fertilizers, apart from fertilizer pricing and subsidy.

Other members of the GoM include finance minister P. Chidambaram, minister for chemicals and fertilizers Ram Vilas Paswan and deputy chairman of the Planning Commission Montek Singh Ahluwalia.