What are the challenges present in India's fertilizer sector? Highlight the sector’s implications for agriculture and the economy.

Category: Economy (GS -III),

Test Date: 12 Jul 2024

Approach:

Introduction: Brief overview of the current scenario
Challenges in the Fertilizer Sector:
- Price Disparities and Subsidies: Heavy subsidies on urea leading to imbalanced fertilizer usage. Impact on soil health and crop yields.
- Production Shortfall: Current production capacity vs. national demand. Dependency on imports despite increased domestic production.
- Environmental Concerns: Energy-intensive production processes. Contribution to environmental degradation and climate change.
Recent reforms and Initiatives:
- Nutrient-Based Subsidy (NBS) Scheme:
- Promotion of Alternative Fertilizers:
Shift towards nano urea and organic farming practices.
Initiatives like Integrated Nutrient Management (INM) and Paramparagat Krishi Vikas Yojana (PKVY).
Significance of the sector
- Farmers' Perspective: Accessibility and affordability of fertilizers, Potential benefits of reforms on farm incomes.
- Economic Implications: Role of fertilizers in ensuring food security, Contribution to agricultural productivity and GDP growth.
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