Govt more than doubles fertiliser dealers' margin on urea sales

The central government on Friday announced an upward revision in the dealer’s margin to Rs354 per metric tonne of urea for both for private agencies and institutional agencies effective 1 April 2018.

The move will benefit approximately 23,000 fertiliser dealers across the country by enhancing their financial viability post DBT implementation, according an official release issued by the ministry of chemicals fertilisers.
The revised dealer’s margin of Rs354 per metric tonne will be paid uniformly to all dealers / distributors for the sale of urea, the release said, adding that the quantity will be sold through POS devices only.
At present, private agencies and co-operatives are being paid distribution / dealer margin for the sale of urea at the rates of Rs180 per metric tonne for sales through private trade and Rs200 per metric tonne for sales through institutional agencies, in accordance with the notification dated 18 June 1999.
Since the government decided to implement Direct Benefit Transfer (DBT) for fertiliser sales, there was a demand for increasing the distribution / dealer margin. Consistently dealers and the fertilizer companies have been raising sales margins to ensure financial viability of dealers post DBT implementation.
Around 23,000 Dealers / Distributors across the country are likely to be benefitted by the decision which would enhance their financial viability post DBT implementation. 
This step will entail an additional subsidy burden of Rs515.16 crore per annum on the government.