New Delhi: The Centre has decided to cut subsidy on fertilizers. It will save more than Rs 10,000 crore for the government but will make fertilizers costly for the farmers. In the cabinet meeting held on Thursday, proposal for subsidy cut on phosphorus and potassium fertilizers has been approved. It will be implemented from April 1.

The government does not have control on prices of phosphorus and potassium based fertilizers. But provision of subsidy on nutrient based fertilizers has been made to promote its usage.

Seeing low fertilizer prices across the world market, the Fertilizer Ministry had sent proposal to reduce subsidy on Nitrogen (N) and Potassium (K) fertilizers for cabinet approval. According to this, in the year 2012-13 there will be subsidy of Rs 24 per Kg on these two fertilizers. Whereas, a subsidy of Rs 21.8 will be given on phosphate (P). Under the Nutrient Based Subsidy plan in 2011-12, subsidy on nitrogen, phosphate and potash were Rs 27.15, Rs 32.33 and Rs 26.76 respectively.

According to a senior official in the Fertilizer Ministry, there will be a cut of 20 percent on subsidy bill by this decision. However in the current FY, estimated subsidy bill on phosphorus and potash can go upto Rs 52,000 crore. Provision of subsidy on nutrient based fertilizer had been done from April 2010.  Under this, phosphorus and potash based 22 fertilizers were made control-free.