India changes agricultural subsidies to promote soil health

This week, the Wall Street Journal highlighted India’s decision to change some of its agricultural policies, in response to its punjab_ag_crisis_WSJ.jpgpost-Green Revolution crisis. (Hat tip: Bandana)

In the 1970s, India dramatically increased food production, finally allowing this giant country to feed itself. But government efforts to continue that miracle by encouraging farmers to use fertilizers have backfired, forcing the country to expand its reliance on imported food. [WSJ]

Kamaljit Singh, a 55 year old from Marauli Kalan in Punjab, explained:

He says farmers feel stuck. “The soil health is deteriorating, but we don’t know how to make it better,” he says. “As the fertility of the soil is declining, more fertilizer is required.” [WSJ]

Behind the worsening health of the soil is India’s agricultural policy. In it’s effort to boost food production, win farmer votes and encourage the domestic fertilizer industry, the government increased its subsidy of urea over the years, and now pays about half of the domestic industry’s cost of production.

Like humans, plants need balanced diets to thrive. Too much urea oversaturates plants with nitrogen without replenishing other nutrients that are vitally important, including phosphorus, potassium, sulfur, magnesium and calcium.

With urea selling for a fraction of the price of other fertilizers, farmers began using substantially more of the nitrogen-rich material than more expensive potassium and phosphorus products.

In Haryana, farmers used 32 times more nitrogen than potassium in the fiscal year ended March 2009, much more than the recommended 4-to-1 ratio, according to the Indian Journal of Fertilizers, a trade publication. In Punjab, they used 24 times more nitrogen than potassium, the figures show. [WSJ]

This imbalance in the soil’s nutrients leads to 2 major problems: (1) ironically, a lower yields in plants because the soil isn’t healthy, and (2) a depleted water table because land needs to be watered more when fertilizer is used. The government has proposed a new plan, but under heavy pressure from fertilizer companies, has retained subsidies for fertilizer companies, though the form of the subsidy has changed.

Under the new plan, the government will offer subsidies to fertilizer companies on the nutrients, such as sulphur, phosphorus and potassium, from which their products are made, rather than the fertilizer products themselves. The idea is to provide incentives for farmers to apply a better mix of nutrients.

Ultimately, the government plans to pay the subsidy directly to farmers, who will be able to buy products of their choice, including but not limited to urea.

Mr. Singh’s government, however, said it would continue to subsidize urea, although it would set the price 10% higher. [WSJ]


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49 Responses to “India changes agricultural subsidies to promote soil health”

  1. bhai says:

    Another step is allowing people to grow wheat in place of rice to preserve the water table

  2. bhai says:

    Another step is allowing people to grow wheat in place of rice to preserve the water table

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