Details about DTB Scheme in Fertilizer Sector

"DIRECT BENEFIT TRANSFER SCHEME (DTBS)"

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Introduction:

The Direct Benefit Transfer Scheme (DBTS) provides for direct transfer of money into the bank accounts of eligible person identified and covered under various Government welfare programs. The money transfer directly into the beneficiary accounts is the different between the market price and subsidiary price, which is in the proportion to the quantity uplifted from the market.

This scheme was launched on 1st January, 2013 by the former Prime Minister of India Manmohan Singh in 20 districts of India. This scheme was inaugurated on 6th January 2013 at Gollaprolu in East Godavari district.

Facts:

Union Minister of State for Chemicals and Fertilizers, Shipping, Road Transport & Highways, Shri Mansukh L. Mandaviya, in a written reply in Rajya Sabha announced that the Direct Benefit Transfer (DBT) being implemented in fertilizer subsidy payment is slightly different from the normal DBT being implemented in LPG subsidy. The Minister informed that under the Direct Benefit Transfer (DBT) in fertilizer sector, the subsidy will be released to the fertilizer companies instead of the beneficiaries, after the sale is made by the retailers to the beneficiaries.

Needs of DBTS in Fertilizer Sector:

• As per the economic survey, it is ideal to introduce DBT in fertilizer sector with Biometrically Authenticated Physical Uptake (BAPU) - A confirming identity using Aadhaar & physically taking sponsored goods and DBT should be given in cash.
• Government will be having a real time fertilizer monitoring system that will help to monitor the fertilizer supply chains.
• DBTS will help to control leakage in fertilizer sector, which has about 40% of leakage & make subsidizations workable & targeted.
• Central government control over this sector is high. This lessens administrative difficulty.

Benefits:

• Multiple subsidized products, urea and 21 grades of Phosphatic & Potassic fertilizers have different subsidy rates.
• The subsidy rate in honour r of urea varies from organization to organization due to different energy efficiencies of plants, production processes, vintage etc.
• As the amount of subsidy in some fertilizers especially urea is more than doubles the Maximum Retail Price (MRP), it will be a huge financial burden on the farmers to pay the MRP and subsidy upfront and receive the subsidy amount subsequently.

Experimental Projects District & State List:

1. Maldah, South 24 paraganas – West Bengal
2. Karnal, Kurukshetra – Haryana
3. Krishna, West Godavari – Andhra Pradesh
4. Nasik, Raigarh – Maharashtra
5. Narmada – Gujarat
6. Kishanganj – Bihar
7. Tumkur – Karnataka
8. Pali – Rajasthan
9. Hoshangabad – Madhya Pradesh
10. Rangareddy – Telangana
11. Kannur – Kerala
12. Una – Himachal Pradesh