Cabinet raises rabi P&K fertiliser subsidy 64% to ₹62,370 crore for 2026-27
In one line: The Centre has raised the subsidy on phosphatic and potassic fertilisers for rabi 2026-27 to ₹62,370.02 crore, about 64% more than last rabi, as world prices of DAP, potash and sulphur climb.
Published 12 November 2026. Written by Pratidin from the reports linked at the end; every fact checked by a separate review before publishing. How we work
The Union Cabinet, chaired by Prime Minister Narendra Modi, on 11 November 2026 approved Nutrient Based Subsidy (NBS) rates for phosphatic and potassic (P&K) fertilisers for the rabi 2026-27 season, which runs from 1 October 2026 to 31 March 2027. The tentative budgetary requirement is ₹62,370.02 crore. That is ₹24,417.73 crore more than the ₹37,952.29 crore set aside for rabi 2025-26, an increase of about 64%. The Cabinet said the subsidy was being rationalised because of recent trends in international prices of urea, di-ammonium phosphate (DAP), muriate of potash (MOP) and sulphur. Information and Broadcasting Minister Ashwini Vaishnaw said the subsidy "will ensure smooth availability of these fertilizers to the farmers at affordable prices".
The per-kg rates show where the pressure lies. For rabi 2026-27 the subsidy is ₹94.21 per kg of nitrogen (N), ₹66.11 per kg of phosphorus (P), ₹2.38 per kg of potash (K) and ₹10.42 per kg of sulphur (S). For kharif 2026, approved on 8 April 2026 with an outlay of ₹41,534 crore, the rates were ₹47.32 (N), ₹52.76 (P), ₹2.38 (K) and ₹3.16 (S). So the nitrogen rate has roughly doubled in one season while potash is unchanged. Reports say the government aims to keep DAP at ₹1,350 per 50-kg bag through extra assistance. Domestic makers of sulphur-based fertilisers get help equal to 20% of their actual procurement cost, with floor prices of $800 a tonne for sulphur and $266.67 a tonne for sulphuric acid.
Under NBS, in force since 1 April 2010, the government fixes a subsidy per kg of each nutrient and pays it to manufacturers and importers, who then sell 28 grades of P&K fertilisers, including DAP, at subsidised prices. Urea is not covered by NBS. Reported stocks on 10 November 2026 were 235.21 lakh tonnes, against 173.46 lakh tonnes a year earlier, with only single super phosphate (SSP) lower. The Hindu reported that the higher outlay overshoots Budget estimates. Supporters see the decision as protecting farmers from a global price shock; the larger concern is that a fixed-rate subsidy now has to be reset sharply each season, which strains the fiscal plan and keeps the import bill exposed.
Prelims facts
- The Cabinet approved NBS rates for rabi 2026-27 (1 October 2026 to 31 March 2027) with a tentative outlay of ₹62,370.02 crore, about 64% above rabi 2025-26.
- Rabi 2026-27 NBS rates are ₹94.21/kg for N, ₹66.11/kg for P, ₹2.38/kg for K and ₹10.42/kg for S; the kharif 2026 N rate was ₹47.32/kg.
- NBS has applied to P&K fertilisers since 1 April 2010; the subsidy is paid to companies, and 28 grades including DAP are covered. Urea is outside NBS.
- Sulphur and sulphuric acid makers get assistance of 20% of procurement cost, with floors of $800 and $266.67 a tonne.
- Reported fertiliser stocks on 10 November 2026 were 235.21 lakh tonnes against 173.46 lakh tonnes a year earlier.
Quick recall
- Since when have P&K fertilisers been under the Nutrient Based Subsidy scheme?
- 1 April 2010.
- Tentative NBS outlay for rabi 2026-27?
- ₹62,370.02 crore, about 64% above rabi 2025-26 (₹37,952.29 crore).
- NBS rate per kg of nitrogen for rabi 2026-27?
- ₹94.21 per kg (kharif 2026: ₹47.32).
- NBS rate per kg of potash for rabi 2026-27?
- ₹2.38 per kg, unchanged from kharif 2026.
- How many grades of P&K fertilisers are available at subsidised prices?
- 28 grades, including DAP.
- To whom is NBS subsidy paid?
- To fertiliser manufacturers and importers, at the approved and notified rates.
- Assistance to domestic sulphur and sulphuric acid makers?
- 20% of actual procurement cost, with floors of $800/tonne (sulphur) and $266.67/tonne (sulphuric acid).
- Rabi 2026-27 season dates for NBS rates?
- 1 October 2026 to 31 March 2027.
Prelims practice question
With reference to the Nutrient Based Subsidy (NBS) scheme in India, consider the following statements:
1. It fixes the subsidy on the basis of nutrients such as nitrogen, phosphorus, potash and sulphur.
2. It covers urea along with phosphatic and potassic fertilisers.
3. The subsidy is paid directly into the bank accounts of farmers.
Which of the statements given above is/are correct?
- 1 only
- 1 and 2 only
- 2 and 3 only
- 1, 2 and 3
Show answer
Answer: (a) 1 only. Statement 1 is correct: NBS sets a per-kg subsidy for N, P, K and S. Statement 2 is wrong: NBS covers P&K fertilisers such as DAP and NPKS grades, not urea. Statement 3 is wrong: the subsidy is released to fertiliser companies at the notified rates, not to farmers.
Use this in UPSC Mains: previous-year questions
Recurring theme: Farm input subsidies: design, fiscal cost and WTO issues
- How to use this
Use NBS as the leading example of an input subsidy, showing its design, its 2026-27 cost and why it raises fiscal and balance concerns.
- NBS (since 1 April 2010) fixes per-kg subsidy on N, P, K and S; rabi 2026-27 outlay is ₹62,370.02 crore, about 64% above rabi 2025-26.
- Nitrogen support rose from ₹47.32/kg in kharif 2026 to ₹94.21/kg in rabi 2026-27, showing exposure to world prices.
- Subsidy is paid to companies for 28 P&K grades, with extra help to hold DAP at ₹1,350 per 50-kg bag.
- How to use this
Cite the rabi 2026-27 NBS outlay as an example of a large input subsidy whose cost depends on global prices.
- P&K support for 2026-27 exceeds ₹1 lakh crore: ₹41,534 crore for kharif 2026 and ₹62,370.02 crore for rabi 2026-27.
- The Cabinet tied the increase to international prices of urea, DAP, MOP and sulphur.
Mains practice question
The rabi 2026-27 fertiliser subsidy is about 64% higher than last year's. Examine how the Nutrient Based Subsidy scheme works and the fiscal and agronomic issues it raises. (250 words)
Model answer
On 11 November 2026 the Cabinet approved Nutrient Based Subsidy (NBS) rates for rabi 2026-27 with a tentative outlay of ₹62,370.02 crore, about 64% more than the ₹37,952.29 crore of rabi 2025-26, citing global prices of DAP, MOP and sulphur.
How NBS works
- Since 1 April 2010 the Centre fixes a per-kg subsidy on nitrogen, phosphorus, potash and sulphur for each season.
- The subsidy is paid to manufacturers and importers, who sell 28 P&K grades, including DAP, at subsidised prices.
- Rabi 2026-27 rates: ₹94.21/kg N, ₹66.11/kg P, ₹2.38/kg K, ₹10.42/kg S.
- Extra assistance aims to hold DAP at ₹1,350 per 50-kg bag; sulphur and sulphuric acid makers get 20% of procurement cost.
Fiscal issues
- The N rate has roughly doubled from ₹47.32/kg in kharif 2026, so outlays swing with world prices.
- Kharif 2026 already needed ₹41,534 crore; the rabi figure reportedly overshoots Budget estimates.
- Import dependence for DAP, MOP and sulphur keeps the bill exposed to West Asian disruptions.
Agronomic issues
- Urea is outside NBS, so relative prices can tilt farmers towards nitrogen and away from balanced use.
- Unchanged potash support (₹2.38/kg) can weaken the incentive to apply K.
- Stocks of 235.21 lakh tonnes on 10 November ease supply worries but not cost worries.
Way forward
- Bring urea into a nutrient-based framework in stages.
- Expand domestic phosphate and sulphur capacity and long-term supply deals.
- Promote soil-test based balanced fertilisation.
NBS has shielded farmers from a price shock, but lasting relief needs lower import dependence and balanced nutrient use.
The basics
Why this matters
Fertiliser is the single largest farm input subsidy that the Centre pays out season by season. The rabi 2026-27 decision shows how a global price shock travels straight into the Union Budget, and why the design of the subsidy matters as much as its size.
Two regimes for two kinds of fertiliser
India runs two different systems. Urea, the main nitrogen fertiliser, is sold at a price the government controls, and the subsidy covers the gap between cost and that price. Phosphatic and potassic (P&K) fertilisers such as DAP, MOP and NPK complexes have been under the Nutrient Based Subsidy scheme since 1 April 2010.
- Retail price controlled by the government
- Subsidy covers the gap between cost and that price
- Not part of NBS
- Fixed subsidy per kg of N, P, K and S
- Paid to manufacturers and importers
- 28 grades including DAP and NPKS
How a season's rates are set
Every kharif (April to September) and rabi (October to March) season, the Cabinet fixes rupee rates per kg of each nutrient. A bag's subsidy is then the sum of its nutrient content multiplied by those rates.
- 1Global prices moveCosts of DAP, MOP, sulphur and urea inputs change abroad
- 2Cabinet fixes ratesPer-kg subsidy for N, P, K and S for the season
- 3Companies claim subsidyPaid on sales at the notified rates
- 4Farmer buysBag sold below cost, for example DAP at ₹1,350 per 50 kg
What changed this rabi
The nitrogen rate rose to ₹94.21 per kg, against ₹47.32 per kg in kharif 2026. Phosphorus rose from ₹52.76 to ₹66.11, sulphur from ₹3.16 to ₹10.42, while potash stayed at ₹2.38.
The fiscal picture
The rabi outlay of ₹62,370.02 crore compares with ₹37,952.29 crore a year earlier. Added to the ₹41,534 crore approved for kharif 2026, P&K support alone crosses ₹1 lakh crore for 2026-27, before urea is counted.
The bigger debate
Supporters say the fixed-per-nutrient design lets the government respond quickly and keeps prices stable for farmers. Critics point to Balanced fertilisation and the NPK ratio: as long as urea is cheap and outside NBS, farmers tend to overuse nitrogen. They also point to heavy Import dependence in fertilisers, which turns every West Asian disruption into a Budget problem. The deeper fix lies in Fertiliser subsidy and the Budget reform and domestic capacity.
Go deeper
Why it matters for UPSC
Farm subsidies are a named GS3 topic, and fertiliser support is the largest input subsidy. Prelims asks how NBS works and what it covers; Mains asks about subsidy design, fiscal stress and WTO issues.
The core idea
P&K fertilisers are under the Nutrient Based Subsidy scheme: the Centre fixes a rupee subsidy per kg of nitrogen, phosphorus, potash and sulphur each season and pays it to companies. Because India imports much of its phosphate, potash and sulphur, Import dependence in fertilisers makes these rates swing with global prices. The swing feeds into Fertiliser subsidy and the Budget, and the price gap between urea and P&K shapes Balanced fertilisation and the NPK ratio on farms.
Numbers and dates to remember
- Rabi 2026-27 outlay: ₹62,370.02 crore; rabi 2025-26: ₹37,952.29 crore
- Rates per kg: N ₹94.21, P ₹66.11, K ₹2.38, S ₹10.42
- Kharif 2026: ₹41,534 crore, approved 8 April 2026
- NBS since 1 April 2010; 28 grades covered
- Stocks on 10 November 2026: 235.21 lakh tonnes
Where to go next
- Nutrient Based Subsidy scheme: how the per-nutrient subsidy is fixed and paid
- Import dependence in fertilisers: why global prices hit India's subsidy bill
- Fertiliser subsidy and the Budget: what a season-by-season reset does to fiscal planning
- Balanced fertilisation and the NPK ratio: why the urea and P&K gap matters for soils
Go deeper: does NBS still do what it was meant to do?
NBS was designed to let the market set P&K prices while the state paid a fixed, predictable amount per nutrient. In practice the government still steers retail prices, as with the aim of holding DAP at ₹1,350 per 50-kg bag, and the per-kg rates are reset every six months to absorb global swings.
The case for the current approach
- Farmers are shielded from sudden price spikes during sowing, which protects output and rural incomes.
- Stocks of 235.21 lakh tonnes on 10 November 2026, against 173.46 lakh tonnes a year earlier, suggest supply has been secured.
- Support to domestic sulphur and sulphuric acid makers (20% of procurement cost) aims to build local capacity.
The case for reform
- Doubling the nitrogen rate in one season shows how exposed the scheme is to Import dependence in fertilisers.
- Outlays that overshoot Budget estimates complicate Fertiliser subsidy and the Budget and crowd out other spending.
- Keeping urea outside the Nutrient Based Subsidy scheme keeps nitrogen relatively cheap and works against Balanced fertilisation and the NPK ratio.
- A flat potash rate of ₹2.38/kg gives little nudge to apply K where soils need it.
Exam angle Link this to the WTO debate on input subsidies, to the fiscal deficit path, and to soil health. A balanced answer acknowledges the food security logic while asking for a gradual move to nutrient-neutral pricing and domestic raw material security.
Nutrient Based Subsidy scheme
How the per-nutrient subsidy on P&K fertilisers is fixed and paid
In one line: Since 1 April 2010, the Centre pays a fixed subsidy per kg of nitrogen, phosphorus, potash and sulphur in P&K fertilisers, instead of fixing each product's price.
How it works
For each kharif and rabi season the Cabinet notifies per-kg rates for N, P, K and S. The subsidy on a product depends on its nutrient content. It is paid to manufacturers and importers on sales, and 28 grades of P&K fertilisers, including DAP and NPKS complexes, are covered.
What it leaves out
Urea, the main nitrogen fertiliser, is not under NBS. Its retail price is controlled by the government, which means the price signal between nitrogen and other nutrients is set by two different systems.
Why it is in the news
For rabi 2026-27 the rates are ₹94.21 (N), ₹66.11 (P), ₹2.38 (K) and ₹10.42 (S) per kg, with a total outlay of ₹62,370.02 crore.
Where to go next
Import dependence in fertilisers
Why global prices hit India's subsidy bill
In one line: India relies on world markets for much of the raw material and finished product in phosphatic and potassic fertilisers, so global shocks show up quickly in subsidy rates.
The basic problem
Phosphate rock, potash and sulphur are inputs that India has in limited quantities at home. DAP and MOP are also imported as finished products. When their prices rise abroad, the per-kg subsidy needed to keep retail prices stable rises too.
Why it is in the news
The Cabinet tied the rabi 2026-27 decision to recent international prices of urea, DAP, MOP and sulphur. Reports link the price rise to West Asia supply disruptions. The nitrogen rate roughly doubled from kharif 2026, and the scheme now gives domestic sulphur and sulphuric acid makers help equal to 20% of procurement cost, with floors of $800 and $266.67 a tonne.
Where to go next
Fertiliser subsidy and the Budget
What a season-by-season reset does to fiscal planning
In one line: The fertiliser subsidy is a large, open-ended item in the Union Budget whose final size depends on world prices that the government does not control.
Why it is hard to budget
The Budget sets an estimate at the start of the year, but NBS rates are fixed twice a year, after watching global prices. If prices jump, the outlay rises and the government must find extra money, often through supplementary demands for grants, or cut elsewhere.
The 2026-27 numbers
Kharif 2026 needed ₹41,534 crore and rabi 2026-27 needs ₹62,370.02 crore, so P&K support alone is above ₹1 lakh crore for the year, before urea. The Hindu reported that the rabi increase overshoots Budget estimates.
Why it matters
Large unplanned subsidies can push up the fiscal deficit or squeeze capital spending. This is why economists favour lower import dependence and better-targeted support.
Where to go next
Balanced fertilisation and the NPK ratio
Why the urea and P&K gap matters for soils
In one line: Crops and soils need nitrogen, phosphorus, potash and secondary nutrients such as sulphur in balance, and price signals that favour one nutrient can damage soil health over time.
The idea from zero
N, P and K are the three primary plant nutrients. Using too much of one and too little of others lowers the response of crops to fertiliser and can degrade soils. Sulphur and micronutrients matter too, which is why NBS also carries a sulphur rate.
How subsidy design affects it
Because urea is outside NBS and its retail price is controlled, nitrogen tends to be relatively cheap compared with P&K products. When P&K prices rise, farmers may cut back on them. In rabi 2026-27 the potash rate stayed at ₹2.38 per kg while nitrogen support doubled.
What helps
Soil testing, nutrient-specific advice and a gradual move to nutrient-neutral pricing are the usual reform suggestions.
Where to go next
Take the 12 November 2026 quiz: 30 Prelims-style questions with answers