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.