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Food and Fertiliser Subsidy Reform: Merger With PM-Kisan Idea

21 January 20261 min read
AGRICULTURE & RURALFood and FertiliserSubsidy Reform:Merger WithPM-Kisan Idea21 January 2026safalsetu.com

Why in the news

Ahead of the 2026 Union Budget, attention turned to rationalising food and fertiliser subsidies by folding them into a bigger PM-Kisan, to cut distortions.

Key facts

  • Share of budget: about 8.5%.
  • PM-Kisan DBT: ₹3.7 lakh crore to 11 crore farmers.
  • Agricultural subsidies lower input costs (fertiliser, power, seeds) or steady prices through MSP.

Why reform

  • Damage from overuse of urea and chemical fertilisers.
  • Cropping tilted to cereals over pulses and oilseeds.
  • Fiscal strain from rising subsidy bills.

Why subsidies matter

RoleExample
Food securityNFSA and PMGKAY: 5 kg free grains for 813 million people
Global shocks₹3,500/t DAP subsidy in 2025 to steady MRP
DiversificationMission on Pulses buys 100% of tur, urad, masur at MSP; self-sufficiency aimed by 2027
Technology40-50% subsidy on drones and sprayers under Sub-Mission on Agricultural Mechanization
Climate resiliencePM-KUSUM solarised 49 lakh pumps by early 2026

Reform steps

  • ₹2,925 crore to computerise 80,000 PACS.
  • Nutrient-Based Subsidy expansion with magnesium and zinc fortified fertilisers.
  • PM-PRANAM: states get 50% of savings from lower chemical fertiliser use.
  • DBT under PM-Kisan to reduce leakages.

Exam angle

  • Savings-sharing scheme: PM-PRANAM.
  • Solar pump scheme: PM-KUSUM.

Test yourself

1. Food and fertiliser subsidies together make up roughly what share of the Union budget?

They account for about 8.5%.

2. Which scheme gives states 50% of subsidy savings for cutting chemical fertiliser use?

PM-PRANAM shares 50% of the savings.

3. PM-KUSUM solarised about how many agricultural pumps by early 2026?

The notes state 49 lakh pumps.