The Centre has spent ₹70,709 crore in the first 3.5 months of the current fiscal year, representing nearly 40% of the total ₹1.77 lakh crore fertiliser subsidy allocation for 2026-27. According to the fertiliser department's written reply to Rajya Sabha, this accelerated spending pattern indicates the subsidy bill is set to exceed the budget estimate due to the conflict in West Asia. As reported by The Times of India, Minister of State for Chemicals and Fertilisers Anupriya Patel informed Parliament that sufficient funds are available to meet the subsidy expenditure, though the government faces increased pressure from elevated global fertiliser prices.
To ensure adequate fertiliser supplies for the Kharif season, the government has secured 25 lakh tonnes of urea through global tenders in April and an additional 17.7 lakh tonnes in June 2026. As reported by Business Standard, a five-year supply arrangement with Oman will bring in 45 lakh tonnes of urea over the period. The fertiliser department has taken several measures to diversify import sources by engaging with Indian missions in various countries to identify additional suppliers and strengthen the fertiliser supply chain. Closing stocks as of July 15 stand at 69.59 lakh tonnes of urea, 16.45 lakh tonnes of Di-Ammonium Phosphate (DAP), 8.67 lakh tonnes of Muriate of Potash, and 45.24 lakh tonnes of NPKS.
Global urea prices have remained elevated at $572 per tonne last month, representing a 45% increase compared to June 2025 levels, as reported by The Times of India. This price surge is contributing to the higher subsidy expenditure this fiscal year. Officials noted that while actual subsidy spent in FY 2025-26 was around ₹2.2 lakh crore against a revised estimate of approximately ₹1.9 lakh crore, this year's spending is likely to be higher due to the elevated global price levels of soil nutrients. The government's enhanced supply security measures and diversified procurement strategy aim to mitigate these price pressures and ensure timely availability of fertilisers across the country.
Finance Minister Nirmala Sitharaman may seek Parliamentary approval for additional spending as reported by The Times of India. This development comes as the Centre faces increased expenditure from fertiliser subsidies, West Asia-related spending, and initiatives including the electronics manufacturing push through semiconductor and mobile schemes. The discussion around legislative sanction represents a shift from the ministry's earlier stance of waiting for more data before assessing the situation. According to the latest parliamentary schedule, the approval motions are scheduled for debate this week, with the House of Commons having already approved the order on 13 July 2026.
