# Government Bears 90 Percent Cost of Urea Bags to Support Farmers, Reveals Narendra Modi at Red Fort

> During his Independence Day address, Narendra Modi highlighted massive fertilizer subsidies, confirming that urea costing 3,000 rupees in global markets is supplied to farmers for just 300 rupees.

**Type:** article · **Category:** India · **Published:** 2026-08-15 · **Source:** TrendKia
**Canonical:** https://trendkia.com/en/national/lala-kile-se-narendra-modi-ka-khulasa-300-rupaye-ki-yuriya-bori-para-90-phisadi-sabsidi-deti-hai-sarakara-16853 · **Language:** English
**Tags:** Urea Subsidy, Narendra Modi, Fertilizer Prices, DAP Fertilizer, Kharif Season 2026, Agriculture Policy, Ministry of Chemicals and Fertilizers

Addressing the nation from the historic ramparts of the Red Fort in Delhi on 15 August, Narendra Modi outlined key government initiatives aimed at safeguarding the agricultural sector and easing the financial burden on farmers. He emphasized that the central government absorbs a significant portion of fertilizer costs to keep farming affordable and sustainable. Despite sharp fluctuations in international fertilizer prices, essential agricultural inputs like urea and DAP continue to be supplied to domestic farmers at heavily discounted rates, directly aimed at lowering input costs and boosting farm incomes.

## Fertilizer Pricing Reality and Subsidy Breakdown
According to the details shared in the address, the actual market procurement cost of a single bag of urea stands at approximately 3,000 rupees. However, farmers across the country receive it at a subsidized price of just 300 rupees per bag. This calculation reflects an effective government subsidy rate of 90 percent on urea. The stark difference between the import cost and the retail price underlines the substantial financial strain placed on the national exchequer to cushion agricultural producers. A similar subsidy mechanism applies to Di-ammonium Phosphate, commonly known as DAP. While the global market price for DAP has escalated to 5,000 rupees per bag, it is made available to Indian farmers at 1,350 rupees per bag.

## Global Conflict and Subsidies in June Data
International geopolitical tensions have directly impacted global fertilizer commodity prices. Disruptions stemming from the conflict involving the United States and Iran triggered a sharp spike in raw material and supply chain costs worldwide. Official government data released in June indicated that the subsidy provided on urea surged from 2,900 rupees per bag to as high as 4,500 rupees per bag due to rising international quotes. At present, retail prices for urea across domestic outlets are maintained between 245 rupees and 300 rupees per bag, shielding domestic producers from global volatility.

## Fiscal Demand Reaches 3.4 Lakh Crore Rupees
The persistent elevation of global fertilizer prices has expanded the government's subsidy liabilities well beyond initial budgetary projections. The Ministry of Chemicals and Fertilizers has requested approximately 3.4 lakh crore rupees for the current fiscal year from the Finance Ministry. This required allocation is nearly double the initial budget estimate of 1.71 lakh crore rupees set aside for fertilizer subsidies. While the government aims to boost domestic production capacity to reduce reliance on costly imports, public expenditure on fertilizer relief continues to grow in the short term.

## Kharif Season 2026 Demand and Buffer Stocks
Projections by the Department of Agriculture estimate a requirement of nearly 390 lakh tonnes of fertilizer for the upcoming 2026 Kharif cropping season. To prevent supply bottlenecks, the government typically maintains a mandatory buffer stock level of 33 percent. Currently, national reserves stand at approximately 51 percent of requirement, ensuring comfortable availability. Authorities have assured that agricultural operations will not face any shortages during the sowing period. In the preceding 2025-26 fiscal year, total fertilizer subsidy disbursements reached 2.17 lakh crore rupees. India consumes around 6.77 crore tonnes of fertilizers annually, with urea alone accounting for 4 crore tonnes of total demand.

## What this means for you
**Across India:** Controlled agricultural input costs help stabilize food production and keep basic food inflation in check for consumers.

**For Farmers:** Despite soaring international market rates, urea and DAP will remain available at up to 90 percent subsidized rates.

## Questions & Answers

### 1. What is the actual cost of a urea bag versus what farmers pay according to Narendra Modi?
The actual procurement cost of a urea bag is around 3,000 rupees, but farmers receive it at a subsidized price of 300 rupees.

### 2. How much subsidy is provided on DAP fertilizer?
Against a global market price of 5,000 rupees per bag, DAP is supplied to Indian farmers at 1,350 rupees per bag.

### 3. What is the revised subsidy amount requested by the Fertilizer Ministry?
The Ministry of Chemicals and Fertilizers requested 3.4 lakh crore rupees, which is nearly double the budgeted 1.71 lakh crore rupees.

### 4. What is the fertilizer buffer stock situation for the 2026 Kharif season?
Against a required demand of 390 lakh tonnes, the government holds a 51 percent buffer stock compared to the usual 33 percent norm.

### 5. What is India's total annual fertilizer consumption?
India requires 6.77 crore tonnes of fertilizers annually, of which 4 crore tonnes is urea alone.

---
_TrendKia — Har trend, sabse pehle.. Machine-readable view; canonical HTML at the URL above._