DBT Direct Benefit Transfer: Fertilizer Subsidy Scheme for Farmers in India, Registration, Eligibility

DBT Direct Benefit Transfer: The Union Finance Minister Nirmala Sitaraman is all set with proposals for Budget for Financial Year 2023. She aims at providing economic advancement to the pandemic struck country. Finally, the hopes for a better and misery free year shine for farmers. Reportedly, more benefits of the Direct Benefit Transfer or the DBT scheme will be announced for the year 2023. Fertilizer Subsidy Scheme, if successfully executed will prove to be a huge success to the farmers in the country. To know more about DBT and its features, read the following article.

DBT Direct Benefit Transfer: Fertilizer Subsidy Scheme for Farmers in India, Registration, Eligibility
Fertilizer Subsidy Scheme for Farmers

DBT Direct Benefit Transfer Fertilizer Subsidy Scheme

The Department of Fertilizers started the pilot project of Direct Benefit Transfer in 2016. This project aimed at providing financial assistance to farmers during the purchase of fertilizers. It is very difficult for the farmers to spend the money equalising the production cost of fertilizers. Hence, the central government provides subsidies and reduces the cost of fertilizers for the farmers. Earlier, the producers received 80-90% after forwarding the products to the district railheads. The government paid the remaining amount after the farmers purchase fertilizers from the retail shops. This resulted in the scope of dishonesty when the farmers were asked to pay more than what they truly had to pay.

DBT Direct Benefit Transfer

Also Check: PM Kisan Samman Nidhi Yojana Online

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In order to reduce this problem, the government is expected to update the Direct Benefit Transfer Scheme. 100% subsidy will be given to the production companies based on the sales. This will digitalize the entire procedure reducing the risk of corruption.

Highlights of DBT Fertilizer Subsidy Scheme

Name of the SchemeDirect Bank Transfer
DepartmentDepartment of Fertilizers
MinistryMinistry of Chemicals and Fertilizers
CategoryCentral Government Scheme
Launched In2016
AimTo provide subsidies for fertilizer purchase to the producers in order to financially assist the farmers
Expected Update100% subsidy only after the farmers purchase the product from retail shops

Objective of Framer Fertilizer Subsidy

The central purpose to update the scheme in the financial year 2023 will be to reduce the role of mediators in the costings. Earlier with a bifurcated payment system, the intermediaries were able to sell fertilizers at rates higher than those set by the government. This resulted in a reduced benefit to the farmers and unjust earnings of the agents. Hence, now when the producers will get 100% subsidy amount after registered purchase of fertilizers from the farmers, the entire system will be digitalized. This will also ensure that agricultural labourers purchase fertilizers strictly at proper rates. Additionally, the government will get a record of the farmers who are benefitting from the subsidy.

DBT Direct Benefit Transfer Fertilizer Subsidy Scheme Features

The system moved in a way where 80-90% of the subsidy amount was disbursed to the producers once they dispatched the fertilizers to the lower level market agents. Once the retailers sold the fertilizers to the farmers who were eligible for the subsidy, they got the remaining account. This somehow resulted in a reduced market response ratio and also, less efficiency.

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The subsidy outgo was more but the reception was less. Moreover, it was not assured that the farmers were able to get the right benefit and that all farmers were benefitting. Now, reportedly the possibility is that 100% amount will be given to the producers only after the farmers get the fertilizers.

A digitalized system might be followed. The POS or Point of Sales devices will be set up in each retail shop which will record the amount of fertilizer sold, the details of the farmer who bought the fertilizer and the money paid. This data will then be received by the government in a digital mode.

Considering this record, the government will transfer the subsidy funds to the producer company. The government will only have to pay the genuine amount of the subsidy that is for the farmers.

This subsidy is however different from the Cooking Gas Subsidy. In the cooking gas subsidy, the beneficiaries receive the subsidy but here the subsidy will be issued for the benefit of the farmers.

But, the production company will receive the subsidy amount. The farmers will continue getting financial assistance from the PMKSN yojana and get the additional benefits from the subsidy at the time of fertilizer purchase. The details like time of sale, buyer, quantity aadhar number, land records, the health of the soil and the biometrics proof through the aadhar card will be captured in the POS device.

The information will be counterchecked from the PMKSN details and the same details will be referred to at the time of subsidy allotment.

Another feature of the DBT scheme is SMS. The Short Message Services will send an electronic receipt and invoice to the farmers for their purchase of fertilizer. This system was introduced on 30th November 2020. The buyers receive the details of their current purchase and will also get notifications regarding the availability of the product at the retailer shop on the basis of their last purchase. In case farmers are unable to receive the notifications, they can easily text the retailer ID to +91 7738299899.

Importance of Subsidy

Both urea-based and non-urea-based fertilizers cost much. The farmers cannot afford such expensive requirements and hence need the support of the government.

For example, the cost of the neem-coated urea is fixed at Rs. 5,922.22 per tonne but the actual cost averages between Rs. 17,000 and Rs. 23,000 depending upon the cost payable to the manufacturers and importers. The difference between the two amounts is covered by the government.

This difference is known as a subsidy. It is provided in addition to the financial support under PM Kisan Samman Nidhi. This benefit is provided to every farmer who requires support for fertilizer purchase.

Application Procedure of DBT Direct Benefit Transfer

how to get subsidy on fertilizer

The details of the farmers registered for PM Kisan Samman Nidhi will be referred at the time of registration. The Aadhar card is not compulsory but is preferred since it will ease the biometrics procedure. The farmers will not have to pay the actual amount and neither the amount higher than that set by the government. The fertilizers will be available to them at a subsidized amount and the subsidy will be paid to the producer once the farmers purchase the fertilizers.

Additional details to this scheme are available at the fert.nic.in portal. The final information regarding the upgrade is expected in the budget of the financial year 2023 by the Union Finance Minister Nirmala Sitharaman.

The latest information will be constantly updated in this article. The readers can regularly check for more news.

Any queries to this scheme can be put down in the comment box and our team will try their best to answer them.

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