Fertiliser companies have been asked not to increase the prices as the government has told them that it will not increase the DAP subsidy on fertilisers. "If the company increases the prices, the government will have to increase subsidy to ensure that farmers do not suffer," said Zee Business Managing Editor Anil Singhvi. 

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The Centre is trying to control the cost of fertilizers. However, after this decision, there are negative reactions coming from the fertiliser companies. Stock corrections are happening in the share market. GSFC, Coromandel Intl, Chambal Fertilisers, Madras Fertilisers are slipping aggressively after this decision.

The government is not planning to increase the subsidy and that is the reason it is asking the fertilizers companies not to increase the prices.

Similarly, there is no approval for the hike in phosphatidic acid prices.

Earlier in May this year, the Central Government provided a total of Rs 14,775 crore subsidy in the Kharif season 21. In which Rs 9,125 crore additional subsidy for DAP and Rs 5,650 crore additional subsidy for NPK based complex fertilizer, will be spent.

The subsidy on P&K fertilizers, including DAP increased more than 100 per cent till Kharif season 21. With the additional amount of Rs 14,775 crore in Kharif season 21 towards this subsidy, the existing subsidy load which was Rs 27,500 crore in 2020-21 was Rs 42,275 crore during the current financial year.

Subsidy of DAP fertilizer was increased from Rs 500 per bag to Rs 1200 per bag, which was an increase of around 140 per cent. Thus, despite the rise in international market prices of DAP, it was decided to continue selling it at the older price of Rs 1200 per bag and the Central Government decided to bear all the burden of price hikes on this account. The amount of subsidy per bag has never been increased so much at once.

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