One Nation, One Fertiliser

The Ministry of Chemicals and Fertilisers has decided to implement One Nation One Fertiliser under the fertiliser subsidy scheme named “Pradhanmantri Bhartiya Janurvarak Pariyojna” (PMBJP). As a result, from October, all subsidised fertilisers will be sold across the country under a single brand name — ‘Bharat’.

About the ‘One Nation, One Fertiliser’ scheme –

• Under the scheme, all fertiliser companies, State Trading Entities and Fertiliser Marketing Entities will be required to use a single “Bharat” brand for fertilisers and logo under the Pradhanmantri Bhartiya Janurvarak Pariyojna (PMBJP). PMBJP is the Centre’s fertiliser subsidy scheme.
• The single brand name for UREA, DAP, MOP and NPKS etc. would be BHARAT UREA, BHARAT DAP, BHARAT MOP and BHARAT NPK respectively.
• Also, a logo indicating Fertiliser subsidy scheme namely Pradhanmantri Bhartiya Janurvarak Pariyojna will be used on said fertiliser bags.
  • • Under the scheme, companies are allowed to display their name, brand, logo and other relevant product information only on one-third space of their bags.
    • On the remaining two-thirds space, the “Bharat” brand and Pradhanmantri Bharatiya Jan Urvarak Pariyojana (PMBJP) logo will have to be shown.
• The scheme is aimed at bringing about uniformity in fertiliser brands across the country under the single brand name of ‘Bharat’.

Need of the scheme –

• Government bears the burden of subsidy and it wants to send that message to farmers —
  • The maximum retail price of urea is currently fixed by the government, which compensates companies for the higher cost of manufacturing or imports incurred by them.
    • The MRPs of non-urea fertilisers are, on paper, decontrolled.
    • But companies cannot avail of subsidy if they sell at MRPs higher than that informally indicated by the government.
    • In other words, there are some 26 fertilisers (inclusive of urea), on which government bears subsidy and also effectively decides the MRP.
  • The fertiliser subsidy bill of the government is huge and only second to the food subsidy in terms of expenditure.
    • It is expected to be over Rs. 2 lakh crore in 2022-23.
  • Hence, the government possibly felt that farmers should know the financial burden it incurs in providing fertilisers at a cheaper rate.
• To reduce transport subsidies —
  • The government also pays manufacturers freight subsidies– or the cost of ferrying their products to the end-user.
  • The government decides where manufacturers can sell their products under the Fertiliser (Movement) Control Order, 1973.
  • However, due to the freight subsidy provided, manufacturers don’t hesitate to sell across longer distances.
  • Hence, another argument for the launch of single-brand fertilisers is to reduce transport subsidies, estimated to be over ₹6,000 crore per year.
• To curtail brand-wise demand for fertilisers in specific areas —
  • Using freight subsidy, manufacturers were involved in the criss-cross movement of fertilisers for longer distances.
    • A company producing fertiliser in UP was selling it to farmers in Maharashtra and vice versa.
  • This created brand-wise demand for fertilisers in specific areas leading to shortage of fertilisers in other areas.
  • At the same time, local manufacturers also suffered.
  • Hence, it was felt that if manufacturers stop selling urea distinctively under individual brands, there would be no need for Indian Farmers Fertiliser Cooperative (IFFCO) to move fertilisers across states.
    • This will ensure uniform availability of fertilisers while reducing the transport subsidy bill.