Agriculture minister seeks urea price cut

 The proposal follows changes in the fertiliser pricing and concession norms from April 1. The changed mode of determining fertilisers subsidies is expected to result in a saving of around Rs 550 crores. The agriculture ministry wants this amount to be passed on to farmers through a cut in fertiliser prices.

 The proposal has been formally conveyed by Agriculture Minister Rajnath Singh to Fertiliser and Chemicals Minister SS Dhindsa. Singh has maintained that fertiliser prices can be reduced to benefit farmers without any additional burden on the exchequer.

 The agriculture minister has suggested the maximum retail price (MRP) of urea be brought down by Rs 5 per a bag of 50 kg. This will amount to a reduction of Rs 100 per tonne.

 For di-ammonium phosphate (DAP) and muriate of potash (MOP), Singh has mooted a retail price cut of Rs 12 per a 50 kg bag, amounting to Rs 240 a tonne. The prices of single super phosphate (SSP) are suggested to be slashed only marginally by Rs 50 a tonne. Singh has pointed out that the revenue loss from all these cuts will not exceed Rs 550 crores.

 The proposal forms part of a series of farmer-friendly measures taken by the Centre at the initiative of the agriculture ministry. These included a package for the sugar sector to help cane growers realise better prices and a cut in interest rates on agricultural loans to a single digit below 9 per cent.

 A downward revision in the rates of premium on agricultural insurance is also under consideration.

 Besides directly benefiting the farmers, these measures are expected to bring down production costs in the agriculture sector. The agriculture ministry feels that lowering of costs has become necessary in view of the steady fall in prices of agricultural commodities.