One reform can yield multiple benefits: India should send its fertilizer subsidy directly to farmers
The fiscal case for reform is compelling. Using the actual 2024-25 spend of ₹1.83 trillion as a baseline, shifting to a farmer-focused DBT system that cuts leakage to say, 10%, could save nearly ₹57,000 crore if urea diversion falls from 41% to 10%, and about ₹1 trillion if overall fertilizer subsidy leakage drops from 65% to 10%. Even on the 2025-26 projection of ₹1.56 trillion, the potential savings range from ₹49,000 crore to ₹86,000 crore.
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