Confusion and ambiguity have surfaced over the amount of money spent on fertilizer subsidies in the current financial year.
The proposed national budget placed by Finance Minister AHM Mustafa Kamal on Thursday put the subsidy figure at Tk12,000 crore, but the agriculture minister went on record with his statement in April that Tk27,000 crore had been spent on fertilizer subsidies.
If the Agriculture Ministry figure is taken into consideration, the proposed subsidy amount of Tk16,000 crore for FY23 is not going to meet the widening gap between high import costs of chemical fertilizers and the low prices at which they are sold to farmers.
“The overall subsidy in FY2021-22 for all types of fertilizer amounts to around Tk12,000 crore. The government will provide Tk16,000 crore as subsidy in the coming fiscal year,” Kamal said.
On April 12, Agriculture Minister Dr Mohammad Abdur Razzaque said Tk27,000 crore had been spent on fertilizer subsidies and the amount would go up to Tk30,000 by the end of FY22 due to an unusual rise in fertilizer prices in the international market.
It could not be confirmed immediately which of the two figures – Tk12,000 crore or Tk27,000 crore – is the correct one.
In his budget speech, the finance minister said: “As you are aware, Russia and Ukraine together play a dominant role in the global fertilizer supply chain. So fertilizer prices increased substantially in the international market because of the Russia-Ukraine crisis. Despite the fact that fertilizer import prices have risen, we have not increased prices in the domestic market. In lieu of price increment, we have prioritized farmer welfare by expanding fertilizer subsidies.”
He also said that the prices of such chemical fertilizers as triple super phosphate (TSP), diammonium phosphate (DAP), and muriate of potash (MOP) went up by 57%, 47%, and 177% respectively, over the last one year.
In FY23, the country's total chemical fertilizer demand has been projected at nearly 6.7 million tons, including 2.6 million tons of urea, 1.5 million tons of DAP, 700,000 tons of TSP, 700,000 tons of MoP, 500,000 tons of gypsum, and 100,000 tons of Zinc Sulphate.