New Delhi, June 2 -- As India scrambles to secure kharif fertilizer supplies amid disruptions in the Strait of Hormuz, urea prices have surged 20-30%. Crisil Ratings has warned of a possible 10-15% fall in domestic output. Against this backdrop, the government's push to transfer fertilizer subsidies directly to farmers deserves careful scrutiny.

India's fertilizer subsidy programme, worth nearly Rs.2 trillion in fiscal year 2026 (FY26), has been central to agricultural policy for decades. It has supported food production, stabilized smallholder incomes, and underpinned the country's food security architecture. The ability to maintain buffer stocks and sustain the public distribution system for 800 million beneficiaries owes considerably ...