DBT in Fertilizers in India - Ms. Kavitha Gotru

Presentation
on
DBT in Fertilizers
27.09.2019
Department of Fertilizers
Why DBT in Fertilizers?
• 2nd largest subsidy program of Government.
• Involves a budget of Rs. 83,466 Crs.
Rationale for DBT in Fertilizers :
• Accurate targeting of beneficiaries
• Avoids delay in provision of subsidy benefits
• Direct and visible impact of the benefits to intended users
• Minimize the leakages or diversion
Department of Fertilizers Slide2

DBT in Fertilizers
• Implementation of DBT in fertilizers has been under discussion for last

20 years without much success.
• In budget speech for 2016-17, Hon’ble FM announced the proposal
“to introduce DBT on Pilot basis for fertilizers in few districts across
the country, with a view to improving the quality of service delivery
to the farmers”
DBT in Fertilizers : Pilot Initiaive
• Niti Aayog decision (March 2016) :
 Pilot in 8 Districts in Rabi 2016 (to be completed by
March 17)
 Pilot in 8 Districts in Kharif 2017 (to be completed by
March 18)
 3 More districts were added on 27th January, 2017
(Begusarai, Dhanbad & Gorakhpur)
Pilot Status
• All 16 districts taken up together for Pilot implementation
• Pilot in 14 Districts completed by 31st March, 2017.
• Pilot in newly added 3 districts – Completed in Aug 2017.

DBT in Fertilizers
Traditional DBT Model

The key process of traditional DBT model (for example in LPG) is:
Beneficiaries and their entitlements are defined.
After Aadhaar based authentication, subsidized entitlements

are sold to beneficiary at market price.
Subsidy amount is transferred to the beneficiary after sale

transaction.

Complexities involved in Traditional Model
DBT in Fertilizers is much more complex than DBT in other
schemes.
 Beneficiary is not defined. (Presently any one is allowed to
purchase fertilizer).
 Beneficiary entitlement is not defined.
 Subsidy amount is more than twice of subsidized price.
(Moving MRP to Market Price will cause huge burden on
farmers as he will be required to pay market price upfront. )
 Multiple products (Urea, P&K etc) have varied subsidy amounts.
 Subsidy component varies plant / Company wise even for the
same product.

Subsidy for Urea manufactured by NFL
Plant Subsidized Price Subsidy Market Price of
(MRP**) component Urea
Nangal 242 908 1150

Panipat 242 984 1226
Bathinda 242 968 1210
Vijaipur-I 242 828 1070
Vijaipur-II 242 809 1051
(All prices are in Rs per 45 Kg bag)
** MRP includes dealers’ margin and
mFMS IT charges.

DBT in Fertilizers : Framework
 Selling price of fertilizer not moved to market price, unlike LPG. Farmers are
not be required to pay market price upfront.
 Farmer is identified on the basis of Aadhaar/ EPIC/ KCC.
 Farmer decides what to buy and how much to buy.
 Fertilizers are sold to farmers at subsidized MRP, only subsidy amount is paid
by the Government on behalf of farmer, directly to the manufacturer.
 Earlier subsidy is paid to the manufacturer on basis of “receipt in district”,
Under DBT the subsidy is paid on the basis of “actual sales” captured on
PoS device at retail point. Subsidy to manufacturer will be paid on weekly
basis.

Fertilizer Sale to Farmer through PoS Device
Buyer visits
Retailer
Buyer
Retailer asks for his shares
NO Voter ID or
Demographic Aadhar Aadhaar No.
records are request for mFMS (DoF) KCC
captured verification
using e-KYC through KSA Server
Retailer logins with

Biometric Aadhaar
CSC Server as Authentication
UIDAI Database
ASA
Authentication done
through Aadhaar
YES
Sale transaction details

Recommendations from Sale Completed
are entered
Land records and Soil
Health card
Land Records Database &

SHC Database

DBT Rollout in pilot districts: Status
Sr. District Retailers / PoS PoS Received / Master DBT Status
No Required Deployed Training
1 Krishna (AP) 973 973/973 Completed
Live (1st Oct. 2016)
2 West Godavari (AP) 1100 1100/1100 Completed
3 Una (HP) 230 230/221 Completed
4 Hoshangabad (MP) 246 217/214 Completed Live (1st Jan. 2017)
5 Pali (Rajasthan) 343 343/270 Completed
6 Kishanganj (Bihar) 349 344/308 Completed
7 Karnal (HR) 772 772/688 Completed
8 Kurukshetra (HR) 550 520/506 Completed Live (1st Feb. 2017)
9 Nasik (Maharashtra) 1346 1200/1200 Completed
10 Raigarh (Maharashtra) 200 200/200 Completed
11 Rangareddy (Telangana) 205 205/184 Completed
12 Tumkur (Karnataka) 533 305/282 Completed
Live (1st Mar. 2017)
13 Narmada, (Gujarat) 95 95/95 Completed
14 Thrissur, (Kerala) 178 200/200 Completed
15 Dhanbad, (Jharkhand) 58 58/52 Completed
16 Begusarai, (Bihar) 694 694/546 Completed Live (1st Aug. 2017)
17 Gorakhpur, (UP) 1488 1340/1020 Completed
18 Malda, (WB) 1445 785/666 Went Live with the State of West Bengal
Department of Fertilizers19 South 24Parganas,WB) 2395 2305/1106 Went Live with the State of West Bengal Slide10
Total 13168 11247/9164
Evaluation Studies & Feedback :
1st & 2nd Round (limited to 6 pilot districts – Sept’2016-Jan’2017)
 Implementation of iFMS/DBT System has streamlined the Fertilizer

distribution
 Improved Supply :“Nil shortage "of urea owning to neem coating
 Improved Tracking Through iFMS
 Overcharging has Reduced
 System Cleansing : Retailers who don’t see a business value due to
increased tracking and reduced diversion have left the system.
 Scared to Buy Large Quantities: Both retailers and farmers were of the
opinion that diversion should reduce because of Aadhaar
Authentication.

3rd Round (limited to 14 pilot districts – July-Sept.’2017)
 Reduction of illegal cross border sales. (e.g. Kishanganj to Nepal and

Bangladesh & Karnal district of Haryana to Uttar Pradesh)
 Transaction experience has improved for farmers as authentication

attempts have decreased.
 Peak Season Sales – Provision has been provided for additional 5 devices
at single Retail Outlet to handle Peak Season Sale.
 Retailer readiness – awareness and training efforts are applaudable, but

farmer communication needs to improve.
Based on positive assessment of Pilot Implementation PAN India rollout of
DBT was initiated.

PAN India DBT Rollout Status
S. No. States / UT Go Live Date
1st Oct 2016 ~
1. 17 Pilot District in Various States
1st Aug 2017
2. NCT of Delhi live on DBT in fertilizers 1st September, 2017
Mizoram, , Daman & Diu, Dadra Nagar Haveli,
3. 1st October, 2017
Manipur, Nagaland, Goa, Puducherry (7 UTs/ States)
Rajasthan, Uttarakhand, Maharashtra, Andaman & 1st November, 2017
4.
Nicobar, Tripura, Assam (6 UTs/ States)
Andhra Pradesh, Haryana, Punjab, Chhattisgarh,
5. 1st December, 2017
Madhya Pradesh (5 States)
Kerala, Bihar, Karnataka, Jharkhand, Telangana, Tamil 1st January, 2018
6.
Nadu (6 States)
Uttar Pradesh, West Bengal, Odisha, Gujarat, Himachal 1st February, 2018
7.
Pradesh (5 States)
8. Jammu & Kashmir 1st March 2018
Pan India Rollout & PoS Deployment Status
DBT Live States
1) Delhi
2) Nagaland
3) Manipur
4) Mizoram
5) Goa
6) Puducherry
7) Daman & Diu
8) Dadra Nagar Haveli
9) Andhra Pradesh
10) Himachal Pradesh
11) Punjab
12) Andaman & Nicobar
13) Tamil Nadu
14) Gujarat
15) Maharashtra
16) Haryana
17) Assam
18) Nagaland
19) Rajasthan
20) Madhya Pradesh
21) Chhattisgarh
22) Uttarakhand
23) Telangana
24) Bihar
25) Jharkhand
26) Uttar Pradesh
27) Kerala
28) Karnataka
29) Odisha
30) West Bengal
31) Jammu & Kashmir

Key Stakeholders
1
5
State Dept. of
Governments Fertilizers
Farmers FAI/
NIC & other Fertilizer 2
IT partners Companies
4
Wholesalers &
Retailers
3
.

DBT implementation - Key activities
PoS procurement & deployment : 2.25 lakh PoS devices deployed across the country.
9524 trainings conducted, across India. Includes training of Master trainers,
wholesalers, retailers etc.. Refresher training programmes are ongoing.
District and State level DBT coordination committees have been setup by states for
close monitoring.
Bilingual online training videos prepared for retailers and extensively used for
training activities..
86 Virtual machines/Servers deployed to handle DBT system.
Letters issued by DoF to Chief Secretaries/Prl. Secretaries giving detailed plan of
action, list of Do’s & Don’ts for various stakeholders etc.. Slide16
Operational Challenges
•How to address with Connectivity Issues?
1. Choose Network Service provider carefully (with maximum

Coverage).
2. Use external antenna if connectivity still doesn’t improve.
3. Ask Service Provider to realign antenna to improve signal

availability at retail shop.
4. Multiple connectivity (Wi-Fi, LAN, PSTN ) options provided in

PoS.
“Please use this strategy to resolve connectivity issues at retail
points when connectivity is still poor.”
•How to avoid stock related issues?
1. Use RO module for fertilizer movement/ sale on ‘REAL TIME BASIS’.
2. Advice retailers to enter stock carefully in PoS Devices.
3. Acknowledge incoming stock on real-time basis.
4. Once stock is entered :
“DO NOT SELL FERTILIZRS WITHOUT POS”

How to deal with Peak season sale?

• Identify retailers where rush of farmers is expected during
peak• season.
• Go for Multiple PoS device at retail shop (option to provide 5

devices at single retail point)- Set up multiple sale counters.

Grievance Redressal Mechanism:
• What’s app
• DBT PMU.
• NIC Support Team
• 15 member Multi-lingual Help Desk.

Potential Benefits of DBT
Direct Benefits
 Creates Aadhaar seeded data base of beneficiaries
 Provides transaction visibility at the level of buyers.
 Links the actual sales to subsidy payments
 Linking of Soil Health Card Data with DBT, would lead to optimal use of nutrients and
subsidy savings.
 Significant impact on prevention on leakage and diversion.
Indirect Benefits
 Putting up a PoS devices at 2.25 lakh retailers will create a channel which will provide
Unlimited Opportunities for the Government to reach Rural India. This can become
service delivery channel for other ministries.
 Digitizing transactions will create purchase history of farmers, which can be used by
Financial Institutions to provide credit to farmers based on transaction history at Fertilizer
outlets.
Department of Fertilizers Slide 21

Comparison of Payment under DBT
•Previous System:
• Payments were made on the basis of quantity received in District.
• It used to take 2-3 months to make payment e.g. for the quantity
received in March company become eligible to receive payment in
month of June
•Under DBT:
• Payments are made on weekly basis on the quantity sold through PoS
• DBT Bills are generated on 8th, 16th, 23rd and on the last day of every
month
• All bills are electronically processed.
• All approvals are also done electronically.

Features of DBT: Bill tracking
Payments under DBT system are faster, transparent & more efficient as
compared to the previous system.

Process Re-engineering
 PoS software : captures all the transactions online namely, registration of
retailer, receipt/acknowledgement of stock, sale of fertilizer to buyers using
Aadhaar based Bio-metric authentication.
 Release Order module: tracks the real-time movement of fertilizers along

Plant/Port-Rakepoint-District-Wholesaler-Retailer chain.
 The entire process ensured transparency of all transactions, real-time

movement/ availability of fertilizers, no manual book-keeping and sale of
fertilizers at the actual, subsidized price with the generation of a receipt at retail
point.
 Subsidy payment module: Subsidy Claims are submitted online in iFMS by the
companies using eSign facility. These claims are processed and paid
electronically on weekly basis. Integration of iFMS was done with PFMS to
enable this complete end-to-end electronic payment. This is a path breaking
initiative of Department of fertilizers and first such feat in Govt. of India.
Slide24
 Integration via web-services with D/o Agriculture, Tamil Nadu, facilitating a state
wide app enabling farmers to know current stock availability at the nearest
retail points.
DBT 2.0 Initiatives
Development of DBT Dashboards
Development of PoS 3.0 software
Development of Desktop version of PoS Software

DBT 2.0 Initiatives : Dashboards
Dashboards for DOF, State Agriculture Departments, District Collectors, Marketing Federations
& Co-operative societies
 Top 20 buyers (State wise, District wise)
 Frequent buyers (State wise, District wise)
 Stock Availability :
 Availability at Port
 Availability at Plant
 Availability in States
 Product – wise Availability
 Period-Wise availability (Month, Season and Year)

Dashboards : PAN India Fertilizer Requirement & Availability
Department of Fertilizers https://urvarak.nic.in

Dashboards : PAN India Fertilizer Requirement & Availability
Dashboards : PAN India Retailer Sales
Dashboard for States
Providing State wise view of :
• Top 20 Buyers List
• Frequent Buyer Report
• Retailers Not Sold Fertilizer in Last 3 Months
• Stock as on Today

Dashboard for District Collectors
Providing District wise view of :

• Company Sale
• Wholesalers Sales
• Frequent Buyer Report
• Top 20 Buyers
• Retailers Who Have Not Sale Any Fertilizer During Last 3
Months
• Stock As On Date At District Level
• Wholesaler Stock As On Today
• Retailer Stock As On Today

Dashboard for MarkFeds
Providing District wise view of :

• Company Sales
• Wholesalers Sales
• Wholesaler Stock As on Today
• Retailer Stock During a Period
• Retailer Stock As on Today
• Pending Acknowledgements.

DBT 2.0 Initiatives : PoS version 3.0 & Desktop Version
Features of DBT PoS software Version 3.0 & Desktop Version
 Provision of Aadhaar virtual ID option during use to registration, login and sale activity in
DBT Software.
 Captures Sale to farmers, Mixture manufacturers, Planter association separately.
Multi-lingual facility.
 Provision for Soil Health Card (SHC) recommendation: area-specific, crop-specific
recommendations.
.

Features of Desktop version of PoS software
 Alternative or added facility to PoS devices.
 Reduces the dependency on PoS devices & limited vendors.
 Retailers with Laptops and Computer systems can use high speed broadband service to make
Fertilizer sale.
 Easy to operate, bigger screen compared to small screen of PoS.
 Multilingual facility.
 Sale receipts will be multilingual.
 More Secure: Single point development control with DoF.
 Can serve as additional device for handling peak season sales

Efforts by DoF to streamline DBT system
• Augmentation of IT infrastructure hardware & software

• Augmentation of IT manpower.
• User friendly PoS software (3.0), Desktop version.
• More secure iFMS software.
• Improving the speed of the servers and reducing the shutdown period from
6hrs. to 3 hrs.
• Multi-lingual toll free helpdesk established.
• Disbursement of subsidy under DBT.
• Integration of IFMS with PFMS.
• DBT Dashboards to all stakeholders.

DBT initiatives in pipeline
 Declaration from farmer on the operational land holding and crop area.
 Development of Mobile based PoS software.
 Improved version of RO module.
 Farmer friendly app to know real time fertilizer availability.
 Limiting quantity of fertilizers to large landholder/commercial firms.
 Direct cash transfer to farmer.

DBT in Fertilizers : Scale of Operation & Present Status
Scale of Operation
• 30 States/UTs
• 14 Crore Farmers
• 2.25 lakh Retailers.
• 26,376 Wholesalers
• 181 Fertilizers Companies
• 2,531 States & District Users.
• 16,931 Company Users.
DBT Status as on 19th September, 2019,
• Total Fertilisers sold : 957.62 Lakh MT
• Total PoS Sale Transactions : 14.19 Lakh
• Total unique beneficiaries : 4.33 Crore

THANK YOU
4th Round (limited to 18 states and 54 districts – July-Sept.’2018)
 Preference for Aadhaar based system is increasing among farmers .

 Farmers prefer DBT in Fertilizer because it
• Tracks actual buyer
• Reduces black marketing and diversion
• Reduces overcharging by retailers
• Induces awareness about quantity and price of fertilizer
 76.5% Farmers are aware that urea comes with neem extract coating.
 94.9% Farmers perceive that neem coated urea is beneficial for crops.
 Initiatives such as reducing the size of urea bag and increased retailer
margin seems to have positive impact.
 Majority of farmers don’t prefer direct cash transfer (DCT) in fertilizer even
if first payment is made in advance
• Financial burden
• Not so good experience with LPG subsidy

DBT Rollout in pilot districts: Status
Sr. District Retailers / PoS PoS Received / Master DBT Status
No Required Deployed Training
1 Krishna (AP) 973 973/973 Completed
Live (1st Oct. 2016)
2 West Godavari (AP) 1100 1100/1100 Completed
3 Una (HP) 230 230/221 Completed
4 Hoshangabad (MP) 246 217/214 Completed Live (1st Jan. 2017)
5 Pali (Rajasthan) 343 343/270 Completed
6 Kishanganj (Bihar) 349 344/308 Completed
7 Karnal (HR) 772 772/688 Completed
8 Kurukshetra (HR) 550 520/506 Completed Live (1st Feb. 2017)
9 Nasik (Maharashtra) 1346 1200/1200 Completed
10 Raigarh (Maharashtra) 200 200/200 Completed
11 Rangareddy (Telangana) 205 205/184 Completed
12 Tumkur (Karnataka) 533 305/282 Completed
Live (1st Mar. 2017)
13 Narmada, (Gujarat) 95 95/95 Completed
14 Thrissur, (Kerala) 178 200/200 Completed
15 Dhanbad, (Jharkhand) 58 58/52 Completed
16 Begusarai, (Bihar) 694 694/546 Completed Live (1st Aug. 2017)
17 Gorakhpur, (UP) 1488 1340/1020 Completed
18 Malda, (WB) 1445 785/666 Went Live with the State of West Bengal
Department of Fertilizers19 South 24Parganas,WB) 2395 2305/1106 Went Live with the State of West Bengal Slide40
Total 13168 11247/9164
1st & 2nd Round (limited to 6 pilot districts – Sept’2016-Jan’2017)
 Implementation of iFMS/DBT System has streamlined the Fertilizer

distribution
 Improved Supply :“Nil shortage "of urea owning to neem coating
 Improved Tracking Through mFMS
 Overcharging has Reduced
 System Cleansing : Retailers who don’t see a business value due to
increased tracking and reduced diversion have left the system.
 Scared to Buy Large Quantities: Both retailers and farmers were of the
opinion that diversion should reduce because of Aadhaar
Authentication.

3rd Round (limited to 14 pilot districts – July-Sept.’2017)
 Reduction of cross border sales. (e.g. Kishanganj to Nepal and

Bangladesh & Karnal district of Haryana to Uttar Pradesh)
 Transaction experience has improved for farmers as authentication

attempts have decreased.
 Peak Season Sales – Provision has been provided for additional 5 devices
at single Retail Outlet to handle Peak Season Sale.
 Retailer readiness – awareness and training efforts are applaudable, but

farmer communication needs to improve.
Based on positive assessment of Pilot Implementation PAN India rollout of
DBT was initiated.

4th Round (limited to 18 states and 54 districts – July-Sept.’2018)
 Preference for Aadhaar based system is increasing among farmers .

 Farmers prefer DBT in Fertilizer because it
• Tracks actual buyer
• Reduces black marketing and diversion
• Reduces overcharging by retailers
• Induces awareness about quantity and price of fertilizer
 76.5% Farmers are aware that urea comes with neem extract coating.
 94.9% Farmers perceive that neem coated urea is beneficial for crops.
 Initiatives such as reducing the size of urea bag and increased retailer
margin seems to have positive impact.
 Majority of farmers don’t prefer direct cash transfer (DCT) in fertilizer even
if first payment is made in advance
• Financial burden
• Not so good experience with LPG subsidy

Operational Challenges & Action Taken by DOF
Sr. Operational challenges Action taken by DoF
1. Improved transaction time and Transaction time has improved from 10
requirement of Aadhaar authentication Min to 3 Min.
2. Server and connectivity problems (Need to •Multiple connectivity options such as Wifi,
come repeatedly to retailer shop ) LAN, PSTN are being provided.
•Option of external antenna.
•Software and hardware enhanced at server
end.
3. Various operational issues such as stock RO module developed for capturing real
problems, receipt acknowledgement etc. time fertilizer movement & stock updation.
4. Ineffective grievance redressal  15 Member Multilingual Help Desk set

up.
5. Sale of fertilizers during Peak Season and Facility for having multiple PoS (5 devices)
heavy rush. at retailer point provided.
44

DBT in Fertilizers in India - Ms. Kavitha Gotru

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Presentation

• 2nd largest subsidy program of Government.

• Involves a budget of Rs. 83,466 Crs.

Rationale for DBT in Fertilizers :

• Accurate targeting of beneficiaries

• Avoids delay in provision of subsidy benefits

• Direct and visible impact of the benefits to intended users

• Minimize the leakages or diversion

Department of Fertilizers Slide2

• Implementation of DBT in fertilizers has been under discussion for last

• All 16 districts taken up together for Pilot implementation

• Pilot in 14 Districts completed by 31st March, 2017.

• Pilot in newly added 3 districts – Completed in Aug 2017.

Department of Fertilizers Slide4

Traditional DBT Model

After Aadhaar based authentication, subsidized entitlements

Subsidy amount is transferred to the beneficiary after sale

Department of Fertilizers Slide5

Department of Fertilizers Slide6

Nangal 242 908 1150

Department of Fertilizers Slide7

Department of Fertilizers Slide8

Retailer logins with

Sale transaction details

Land Records Database &

Department of Fertilizers Slide9

 Implementation of iFMS/DBT System has streamlined the Fertilizer

Department of Fertilizers Slide11

 Reduction of illegal cross border sales. (e.g. Kishanganj to Nepal and

 Transaction experience has improved for farmers as authentication

 Retailer readiness – awareness and training efforts are applaudable, but

Department of Fertilizers Slide12

Department of Fertilizers Slide14

Department of Fertilizers Slide15

1. Choose Network Service provider carefully (with maximum

2. Use external antenna if connectivity still doesn’t improve.

3. Ask Service Provider to realign antenna to improve signal

4. Multiple connectivity (Wi-Fi, LAN, PSTN ) options provided in

•How to avoid stock related issues?

1. Use RO module for fertilizer movement/ sale on ‘REAL TIME BASIS’.

2. Advice retailers to enter stock carefully in PoS Devices.

3. Acknowledge incoming stock on real-time basis.

4. Once stock is entered :

“DO NOT SELL FERTILIZRS WITHOUT POS”

Department of Fertilizers Slide18

How to deal with Peak season sale?

• Go for Multiple PoS device at retail shop (option to provide 5

Department of Fertilizers Slide19

Department of Fertilizers Slide20

Department of Fertilizers Slide 21

Department of Fertilizers Slide22

Department of Fertilizers Slide23

 Release Order module: tracks the real-time movement of fertilizers along

 The entire process ensured transparency of all transactions, real-time

Development of DBT Dashboards

Development of PoS 3.0 software

Development of Desktop version of PoS Software

Department of Fertilizers Slide25

Department of Fertilizers Slide26

Department of Fertilizers https://urvarak.nic.in

Providing State wise view of :

• Top 20 Buyers List