Fertiliser Subsidy
Expenditure Beginnerउर्वरक सब्सिडी
Definition
Fertiliser subsidy is the financial support provided to keep fertiliser prices affordable for farmers. The government controls the retail price of urea and provides nutrient-based subsidy for other fertilisers. The subsidy compensates manufacturers for the difference between cost of production and the controlled retail price.
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Why Fertiliser Subsidy Matters
Understanding fertiliser subsidy is essential for anyone following government finances, preparing for competitive exams, or analysing India's economic policy. This concept directly affects how the government allocates resources and plans its fiscal strategy.
In the context of India's Union Budget 2026-27, with a total size of Rs 53.47 lakh crore, terms like fertiliser subsidy help citizens and analysts evaluate whether the government is on the right fiscal path. The numbers in the budget are only meaningful when one understands the underlying concepts.
For UPSC aspirants, fertiliser subsidy is frequently tested in both Prelims and Mains, particularly in Paper III (Economic Development). For CA and MBA students, this concept appears in public finance and macroeconomics courses.
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