Rs 6 bn fertiliser subsidy to be replaced by more farmer-friendly subsidy

The Ministry of Agriculture says it will cancel the current Rs 6 bn fertiliser subsidy for a more farmer-friendly subsidy scheme this year. The Ministry of Agriculture says it will cancel the current Rs 6 bn fertiliser subsidy for a more farmer-friendly subsidy scheme this year. "The government spends Rs 6 bn on fertiliser subsidy. Now we have made a policy decision to give this money directly to the farmers," said Janaka Rajakaruna, coordinating secretary, to the Ministery of Agriculture.

The money will go directly to farmers based on production instead of subsiding the cost of fertiliser.

"We are developing a mechanism of giving the money based on the production. We hope to introduce it this year but it is too late for the Maha season," said Rajakaruna.

The Ministry says the current subsidy benefits fertiliser companies more than it benefits the farmers.

At the moment the government spends Rs 1,200 per bag of fertiliser so that it is sold at Rs 540.

"We have found out the subsidy does not reach the farmer.
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That is why a decision was taken to replace this with a new one," said Rajakaruna.

The Maha sea