PM PRANAM scheme


PM PRANAM scheme

In order to reduce the use of chemical fertilisers by incentivising states, the Union government plans to introduce a new scheme – PM PRANAM, which stands for PM Promotion of Alternate Nutrients for Agriculture Management Yojana.

What is the PM PRANAM scheme?

  • The proposed scheme intends to reduce the subsidy burden on chemical fertilisers.
  • This burden if uneased, is expected to increase to Rs 2.25 lakh crore in 2022-2023, which is 39% higher than the previous year’s figure of Rs 1.62 lakh crore.
  • The scheme will not have a separate budget and will be financed by the “savings of existing fertiliser subsidy” under schemes run by the Department of fertilisers.

Subsidies under the PRANAM

  • Further, 50% subsidy savings will be passed on as a grant to the state that saves the money and that 70% of the grant provided under the scheme can be used for asset creation related to technological adoption of alternate fertilisers.
  • It would create alternate fertiliser production units at village, block and district levels.
  • The remaining 30% grant money can be used for incentivising farmers, panchayats, farmer producer organisations and self-help groups that are involved in the reduction of fertiliser use and awareness generation.
  • The government will compare a state’s increase or reduction in urea in a year, to its average consumption of urea during the last three years.

How much fertiliser does India require?

  • The kharif season (June-October) is critical for India’s food security, accounting for nearly half the year’s production of foodgrains, one-third of pulses and approximately two-thirds of oilseeds.
  • A sizable amount of fertiliser is required for this season.
  • The Department of Agriculture and Farmers Welfare assesses the requirement of fertilisers each year before the start of the cropping season, and informs the Ministry of Chemical and fertilisers to ensure the supply.
  • The amount of fertiliser required varies each month according to demand, which is based on the time of crop sowing, which also varies from region to region.
  • For example, the demand for urea peaks during June-August period, but is relatively low in March and April, and the government uses these two months to prepare for an adequate amount of fertiliser for the kharif season.

Why is the scheme being introduced?

  • Due to increased demand for fertiliser in the country over the past 5 years, the overall expenditure by the government on subsidy has also increased.
  • The final figure of fertiliser subsidy touched Rs 1.62 lakh crore in 2021-22.
  • The total requirement of four fertilisers — Urea, DAP (Di-ammonium Phosphate), MOP (Muriate of potash), NPKS (Nitrogen, Phosphorus and Potassium) — increased by 21% between 2017-2018 and 2021-2022, from 528.86 lakh metric tonnes (LMT) to 640.27 LMT.
  • PM PRANAM, which seeks to reduce the use of chemical fertiliser, will likely reduce the burden on the exchequer.
  • The proposed scheme is also in line with the government’s focus on promoting the balanced use of fertilisers or alternative fertilisers in the last few years.

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