The Cabinet Committee on Economic Affairs, chaired by Prime Minister Shri Narendra Modi has approved the proposal of the Department of Fertilizers for continuation of Nutrient Based Subsidy (NBS)and City Compost Scheme beyond 12^th  Five Year plan till 2019-20.   The total expenditure for continuation of both the schemes till 2019-20 will be ₹ 61,972 crore.

The expenditure for the scheme will be on actual basis since national roll out of DBT entails 100% payment of subsidy to fertilizer companies on sale of fertilizers to farmers at subsidized rates.

The subsidy on the P&K fertilizers and Market Development Assistant (MDA) on City Compost will be provided on the subsidy rates approved by the CCEA on annual basis.

The continuation of the Nutrient Based Subsidy Scheme and City Compost Scheme will ensure that adequate quantity of P&K is made available to the farmers at statutory controlled price.

Background:

Government is making available fertilizers, namely Urea and 21 grades of P&K fertilizers to farmers at subsidized prices through fertilizer manufacturers/importers. The subsidy on P&K fertilizers is being governed by NBS Scheme w.e.f 01.04.2010. Similarly, the MDA is being governed by City Compost Scheme w.e.f. 10.02.2016. Accordingly, these schemes have been extended beyond the 12th Five Year Plan till 2019-20.

Nutrient Based Subsidy continuation approved; subsidy payments and City Compost support to continue ensuring subsidized fertilizer availability. Cabinet extended the Nutrient Based Subsidy and City Compost Scheme through 2019 20, with subsidies paid on an actual basis aligned to national Direct Benefit Transfer rollout; subsidy on P&K fertilizers and Market Development Assistance for City Compost will follow annually approved rates, aiming to ensure adequate availability of P&K fertilizers to farmers at statutory controlled prices.