Date:15/04/2007 URL: http://www.thehindubusinessline.com/2007/04/15/stories/2007041502710100.htm

Back Fertiliser: `Direct subsidy doesn't help farmers'

Our Bureau

MR RAM VILAS PASWAN

Mumbai April 14 The Union Chemicals and Fertilisers Minister, Mr Ram Vilas Paswan, is "not convinced" with the Centre's proposal to give subsidy on urea directly to farmers. The Minister expressed his discontentment on this proposal, as he did not foresee "any benefit for the farmers."

Farmers would first have to buy urea at the prevailing price, which fluctuates depending on naphtha prices, Mr Paswan said. The fertiliser company will then give a certificate to the farmer, which he would show to government officials to claim the money.

The Minister said that he had raised the issue in Parliament, saying that it would "add to red-tapism". He was talking to reporters at the Rasthriya Chemical and Fertilisers Ltd (RCF) on Saturday.

A meeting with Left parties initially, and others, if the need arises, will be called shortly to discuss the issue, he added.

However, a different signal had been sent by the Union Finance Minister, Mr P. Chidambaram, in Budget 2007. He had said the Government would implement a pilot programme in at least one district in each State in 2007-08, to consider an alternative method of delivering the subsidy directly to the farmer.

On the point of subsidy to the industry, Mr Paswan said that it still remains the main issue. Currently, the Central Government has to give Rs 35,000 crore as subsidy, of which Rs 14,000 crore is still pending and needs to be cleared at the earliest, he added.