News Brief

Farmers First: Union Cabinet Greenlights DAP Subsidy Extension And Continuation Of Crop Insurance Plans

Kuldeep NegiJan 01, 2025, 04:22 PM | Updated 04:22 PM IST
A farmer using fertilizer (Representative Image)

A farmer using fertilizer (Representative Image)


The Union Cabinet, chaired by Prime Minister Narendra Modi, on Wednesday (1 January) took two major decisions aimed at bolstering agricultural sustainability and ensuring farmers' welfare.

Extension of Subsidy on Di-Ammonium Phosphate (DAP):

The Cabinet has approved the continuation of a one-time special package providing an additional subsidy of Rs 3,500 per metric ton (MT) on DAP fertiliser beyond the Nutrient Based Subsidy (NBS) scheme.

Effective from 1 January 2025 until further notice, this measure aims to ensure the sustainable availability of DAP at subsidised, affordable and reasonable prices for farmers.

The government has reiterated its commitment to supporting farmers amidst global market challenges and geopolitical constraints, maintaining stable DAP prices for the Kharif and Rabi 2024-25 seasons.

Since April 2010, subsidies on P&K fertilisers have been governed by the NBS scheme, encompassing 28 fertiliser grades.

This latest extension follows a similar package approved in July 2024, where it approved one-time Special Package on DAP beyond the NBS subsidy at Rs 3,500 per MT from April to December 2024 with a financial implication of around Rs 2,625 crore.

"Continuing top most priority in keeping farmers’ welfare in firm focus, Government of India has extended a massive relief to farmers in keeping the price of Di-Ammonium Phosphate (DAP) fertilizer unchanged," the government said.

"Inspite of geo-political constraints and volatility of global market conditions, Government kept its commitment towards farmer friendly approach by ensuring availability of DAP to farmers at affordable prices for Kharif and Rabi 2024-25," it added.


The Cabinet has also approved the continuation of the Pradhan Mantri Fasal Bima Yojana (PMFBY) and the Restructured Weather-Based Crop Insurance Scheme (RWBCIS) until 2025-26.

With a total outlay of Rs 69,515.71 crore for 2021-26, the schemes provide risk coverage against non-preventable natural calamities for farmers nationwide.

To enhance transparency and efficiency, the cabinet has also sanctioned the creation of a Fund for Innovation and Technology (FIAT) with a corpus of Rs 824.77 crore.

This fund will support technology-driven initiatives like the Yield Estimation System using Technology (YES-TECH) and Weather Information and Network Data Systems (WINDS).

YES-TECH, leveraging remote sensing technology, is being implemented in nine major states, while WINDS aims to establish hyper-local weather data networks with a fivefold increase in density.

For the northeastern states, the Centre said that efforts are made and will continue to be made to saturate all farmers of the region on priority.

"To this extent, the centre shares 90 per cent of premium subsidy with North Eastern States. However, due to scheme being voluntary and low gross cropped area in North Eastern States, flexibility has been given to avoid surrender of funds and for reallocation in other development projects and schemes with fund requirement," it added.

Join our WhatsApp channel - no spam, only sharp analysis