The Prime Minister’s Office has set January 1, 2018, as the deadline for the national launch of direct benefit transfers for fertiliser subsidies despite a request from the Fertiliser Ministry for time until April 1 to address technical glitches and low availability of point-of-sale (PoS) machines to capture details of beneficiaries.
“The tentative national rollout of DBT is 1 January 2018,” states a government note on the issue.
Sources said this deadline was conveyed by the Cabinet Secretariat last month and could be aimed at dovetailing the subsidy payout with the government’s plan to align the financial continued on year with the calendar year. The January launch would also provide a lead time of five months to handle any glitches before large purchases start next June, they said.
The move to the DBT system was planned for October 1 this year with deployment of PoS devices across the country by June 30. However, on June 30, the ministry informed companies and state governments that the timeline had been extended to July 31 because of “a lack of availability” of PoS machines.
Faced with glitches in generation of bills in the 14 districts where a pilot project is being tested, the ministry suggested that the national launch be fixed for April 1, 2018, to give time to build server capacity and complete its integration with PoS machines.
The Ministry’s argument is that with 14 crore farmers making an average purchase of fertilisers five times in a year, the web-based online Integrated Fertilizer Monitoring System (iFMS) would require better integration of the server with PoS devices to handle nearly 70 crore transactions expected annually.
Under DBT, subsidy would be disbursed to manufacturers after actual sales registered on PoS machines that would capture farmers’ names and Aadhaar-based biometric authentication details, which would be transferred to the system’s central server.
Currently, fertiliser companies are paid on-account subsidy on receipt of material at railhead points or approved godowns in districts. Post-sale disbursal of fertiliser subsidy is seen as part of the government’s plan to eventually move to a DBT system similar to the one in place for LPG cylinders.
The linking of subsidy payment to data generated at retail sales points would make for the second part of the move towards DBT.
With transactions being captured at the buyer’s level, weeding out non-genuine farmers becomes possible. Once it is known who is buying and how much, the subsidy can be restricted to genuine farmers and, at a later stage, to a maximum number of bags automatically covering holdings below a certain size.