Prices of Fertilizer Bags to

decrease this Year

June 22, 2016 admin Business 0

Unlike the previous budgets, this years budget has proved economical for a few
industries. Eon of the industries which will benefit the most is the agriculture
industry. There has already been a reduction in price of tractors and now the
government has proposed price and tax reductions on fertilizers too.

During this crop season the fertilizer prices will come down 20%. This reduction in
price is due to reduction of sales tax and Rs36 billion subsidies on urea.

The CEO of the Engro Fertilizers Ruhail Mohammed said,

Fertiliser prices are being reduced by around Rs390 per bag, which is a 20pc cut
over the prevailing prices
Out of the total price of the fertilizer pack, Rs 50 will be borne by the manufacturers
and the reaming in will come from the GST, and also from the subsidies on urea by
the government.

The amount of subsidies on Urea this year is huge. The government has given Rs36
billion subsidies on urea this fiscal year. This reduction in the tax and subsidies will
result in lowering the price per bag of the fertilizers i.e. from Rs. 1,800 per bag to Rs.
1,410 per bag.

According to the proposal of the governed, during the next fiscal year, the prices of
Urea bags should be bought down to Rs. 1,400 per bag from Rs. 1,800 per bag. The
prices of DAP bags should be bought down to Rs. 2,500 from Rs. 2,500 per bag. This
price reduction will help the farmers. The prices will be financially beneficial for the
farmers. This in turn, will help the growth of the agricultural industry as a whole.

The CEO of the Engro Fertilizers Ruhail Mohammed also said that the government
should also remove the GST on natural gas. With the price of gas reduces the price
per bag can be reduced even more to Rs 50, he said.