Fertilizers subsidies in India a case study of south zone

To ensure availability of fertilizers to farmers at affordable prices, the government of India provides huge subsidies to fertilizers manufacturing industry from 1977. Hence, the government of India provides indirect subsidies to farmers for the purchase of fertilizers. These subsidies that encourage production and productivity have been widely criticized due to the cost of subsidies and distribution pattern. In this paper, an attempt is made to analyse the growth and distribution pattern of fertilizers subsidies in south zone of India.It is found that in all the states of south zone the fertilizers subsidies neither distributed according to gross cropped area nor productivity throughout the study period 1980–81 to 2006–07. The findings suggest that the centre government should adopt some criteria to give away subsidies to states either on the basis of gross cropped area or productivity.