A Parliamentary panel has pitched for direct transfer of fertiliser subsidy to farmers to check corruption and plugging loopholes in current subsidy regime.
At present fertilizer subsidy is paid directly to the manufacturers of fertilisers. In case of urea the retail price has been fixed at Rs 5,360 per tonne by the government and the difference between cost of production and retail price is paid as subsidy to manufacturers.
While in complex fertilisers, the government fixes the subsidy while the companies are free to decide the price.
"The committee is of the view that transfer of the benefits of direct subsidy to the farmers would check the corruption, close the loopholes and profligacy in subsidies," the Parliamentary Committee on Chemicals and Fertilisers said in its report.
The Department of Fertilisers should work out a mechanism and address the problems faced in targeting, determining entitlements and preparing beneficiary database so the subsidy is disbursed directly to the beneficiaries at the earliest, the report added.
Meanwhile, the committee has been informed that the Department is following a phase approach for direct disbursement of fertiliser subsidy to the intended beneficiaries.
The department has also apprised the parliamentary panel that initial phases of of paying subsidy directly to farmers has already been started but the department is facing problems in final phases.
But the department would work on creating digital database of beneficiaries.
