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The Centre has hiked the benchmark import prices of di-ammonium phosphate (DAP) and muriate of potash (MOP) used to determine the nutrient-based subsidy (NBS) rates on non-urea fertilisers.
The decision, approved by the Union Cabinet here on Thursday, will push up the fertiliser subsidy bill for 2011-12 beyond the budgeted Rs 49,998 crore.
The new benchmark prices for imported DAP has been taken to $612 a tonne from the $580 level originally fixed for the current fiscal. The corresponding reference rate on imported MOP has been raised from $390 to $420 a tonne.
However, the exchange rate to be used for computing the new import parity rates has been taken at Rs 45.65-to-the-dollar, against the earlier Rs 46.06-to-the-dollar level.
The upward revisions in the benchmark import prices of DAP and MOP would translate into higher NBS rates for phosphorus (P) and potash (K), respectively. Currently, the NBS rate on P, linked to a $580-a-tonne reference price for imported DAP, is Rs 29.407 a kg, while the same on K (against a benchmark $390 a tonne for MOP) is Rs 24.628 a kg.
The new NBS rates, along with the corresponding higher subsidy on individual fertilisers, will be separately notified by the Department of Fertilisers. The NBS regime covers 22 non-urea fertilisers, with the subsidy payable on each linked to their nutrient content.
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