Directorate of Economics and Statistics, Department of Agriculture and Cooperation, Ministry of Agriculture and Farmers Welfare, Government of India, New Delhi
Punjab Agricultural University, Ludhiana,India
 Sponsored by
Directorate of Economics and Statistics, Department of Agriculture and Cooperation, Ministry of Agriculture and Farmers Welfare, Government of India, New Delhi
Research Content
Factors Affecting Fertilizer Consumption in India

          Chemical fertilizers being important elements of modern production technology played pivotal role in agricultural growth in India. The present study was undertaken to examine the pattern of fertilizer use, determinants of fertilizer use and economic returns to the use of fertilizers in India. The study was undertaken in five states viz. Haryana, Tamil Nadu, Assam, Punjab and West Bengal during 2004-05 to maintain proper sample spread and to represent the areas of high and low fertilizer use across the country. Apart from the secondary data on growth and pattern of fertilizer use and important factors affecting the fertilizer use, the primary data were also collected on the pattern of fertilizer use and its impact on crop production and economic efficiency. The fertilizers use (N+P+K) increased from 1139.7 thousand tonnes in triennium ending 1968 to 16717.7 thousand tonnes in triennium ending 2003-04. The largest absolute increase occurred in N content because N is the most important element for plant growth and its impact on crop productivity is more pronounced and visible. In the early phase of green revolution during 1965 to 1974 fertilizer use showed tremendous growth. From 1975 to 1990, when the green revolution technology matured, fertilizers use still grew at a high rate but lower than the previous period. The growth has been slow since 1990s. Irrigation was estimated as the most important factor influencing fertilizer consumption in India. Relative decrease in the prices of fertilizers as compared to output prices, increase in area under high yielding varieties and availability of institutional agricultural credit also resulted in higher demand for fertilizers. Higher rainfall in winter months led to higher use of fertilizers and poor rainfall caused lower use of fertilizers. Thus, higher demand for fertilizers in future will largely be influenced by increase in the potential of irrigation, area under high yielding seeds and their relative prices relative to output prices. The impact of fertilizer consumption on the production of wheat and rice was significantly positive. The trends in fertilizer use may be directly correlated with the trends in irrigated area in a region. The states of Punjab, Haryana and West Bengal, which have shown positive and significant growth in the irrigated area during the last four decades or so have witnessed relatively higher growth in fertilizer consumption. However, extent of GIA in Assam is just 5 per cent and that in West Bengal and Tamil Nadu is also below 50 per cent. The states having larger area under assured irrigation such as Punjab and Haryana had significantly higher levels of productivity of food crops as compared to the states with less area under irrigation. It is thus clear that much of the future increase in fertilizer consumption may become possible with an increase in the area under irrigation in these states such as West Bengal, Tamil Nadu, Assam and many other states as Bihar and eastern UP. In high fertilizer consuming states of Punjab, Haryana and Tamil Nadu, the nutrient use in paddy ranged between 206 to 218 kg per hectare. It was much higher than the use of 12.9 kg per hectare in Assam and 124.80 kg per hectare in West Bengal. The nutrient use in wheat was 223.76 kg per hectare in Punjab and 207.65 kg per hectare in Haryana. The nutrient use was relatively less in cotton and vegetables in Tamil Nadu and Assam, respectively. It revealed that in almost all the states, the farmers do not apply fertilizers after getting their soils tested. Such a situation calls for a huge and sincere extension effort to create awareness amongst the farmer for following the practice of soil-testing. Majority of the farmers in Punjab and West Bengal preferred continuation of both fertilizer subsidies and increase in MSP for major crops. The use of production inputs in Punjab and Haryana seems to have reached to a level where their higher use increases productivity marginally. In Assam, fertilizer was found to have significant and positive influence on the productivity of rice crop. The value marginal productivities of fertilizers are much higher than their marginal costs in the states using medium to low levels of fertilizers. This fact points towards the need to refocus the efforts in promoting the fertilizer use. Marginal increase in fertilizer use in West Bengal, Tamil Nadu and Assam and other medium to low fertilizer using states will generate much higher returns by increasing yield and profits. Study concludes that there is little scope to increase the fertilizer use in high fertilizer using areas such as Punjab, Haryana and Western UP. The future increase in fertilizer use is expected to come from the states like West Bengal, Tamil Nadu and many north-eastern states such as Assam where the current level of fertilizer use is either medium or very low. Hence, the states such as should be targeted to increase the fertilizer use in future. Increase in irrigated area in the targeted states will boost the area under high yielding varieties, leading to higher input use including fertilizers and will ultimately lead to higher food grain production contributing to the national food security. In order to rationalize the nutrient ratio (NPK ratio), which currently is highly tilted towards nitrogenous fertilizers, there is need to encourage fertilizer application after soil testing. It will improve productivity; reduce cost of production and ultimately ensuring better returns from crop production. There is need to emphasize the importance of micronutrients in crop production as well. The marginal returns of the micronutrients are higher than their marginal costs even in the states of very high use of macro nutrients such as Punjab and Haryana. Creating awareness and improving availability of micro nutrients will boost their use and hence crop productivity in the country.