Direct benefit transfer project for fertilizer subsidy to roll out in October

NEW DELHI: The government will roll out a pilot project for direct benefit transfer (DBT) for fertilizer subsidy in 16 districts starting next rabi season in October. Rabi crops are sown in winter and harvested in spring..

The government has embarked on a plan to plug leakages in its subsidy regime and the pilot project for fertilizer subsidy is a crucial part of that plan. Finance minister Arun Jaitley had announced plans to introduce the pilot project for fertilizer subsidy in the 2016-17 budget.

The government is keen to emulate the success of the DBT scheme for cooking gas which has helped in plugging leakages. Fertlizer subsidy has been estimated at Rs 70,000 crore for the current fiscal year.

Sources said the districts will be selected from across the country where penetration of Aadhar, Jan Dhan and banking through ATM is more. More digitisation of land record is also one of the criteria for selection.

“While bigger districts such as Krishna in Telangana could be such candidates, about four districts of Bihar and West Bengal bordering Nepal and Bangladesh, besides a couple of districts from Northeast, will be taken up,“ said a government official.

Districts bordering Nepal and West Bengal are being included since there are reports of subsidised urea being smuggled in huge quantity to these countries for industrial use.

A senior finance ministry official said the government will implement the DBT scheme for fertilizer as soon as the results of the pilot project is analysed.