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Historic decisions were taken on Wednesday, 11 November 2026 in the Union Cabinet meeting chaired by Prime Minister Narendra Modi with the aim of protecting the economic interests of crores of farmers of the country and giving new impetus to agricultural productivity. The Central Government has given its official approval to the new revised rates of Nutrient Based Subsidy (NBS) on Phosphatic and Potassic (P&K) fertilizers for Rabi season 2026-27. This special subsidy cycle will be effective from 1 October 2026 to 31 March 2027. During this period, a huge financial allocation of Rs 62,370 crore will be made from the Central Government treasury to provide quality chemical fertilizers to the farmers at affordable, concessional and controlled rates.
This decision is also unprecedented because this amount is about Rs 24,418 crore more than the previous Rabi season 2025-26. Despite the huge rise in the prices of fertilizer raw materials at the international level, the Central Government has not allowed any of its burden to fall on the pockets of the farmers of the country. The main objective of this policy decision is to ensure adequate supply of fertilizer to the farmers without any shortage in the peak season of sowing of wheat, mustard, gram, pea and Rabi oilseeds and pulses. Economic experts believe that this step will not only bring significant stability in agricultural production costs in rural areas but will also lead to positive improvement in the country’s food security and farmers’ income.
While giving detailed information to the media after the cabinet meeting, Union Information and Broadcasting Minister Ashwini Vaishnav clarified that at present the deepening crisis in West Asia and the long period of Russia-Ukraine war is badly affecting the global supply chain. Due to these geopolitical conflicts, the prices of raw materials like rock phosphate, ammonia, potash and urea are skyrocketing in the international markets. Despite this, the top priority of the government under the leadership of Prime Minister Narendra Modi has been to ensure the welfare of farmers. The government has taken a bold resolution to bear the entire financial burden of this unprecedented international inflation.
The Union Minister made a big announcement assuring the farmers across the country that the retail price of a 50 kg DAP (Di-Ammonium Phosphate) bag will remain the same at Rs 1,350. Farmers will not be required to purchase DAP at expensive prices under any circumstances. Government of India is continuously providing all 28 different grades of P&K fertilizers including DAP to the farmers at concessional rates through authorized fertilizer manufacturers and registered importers. It is noteworthy that this Nutrient Based Subsidy (NBS) policy is being run by the Central Government effectively from 1 April 2010, under which subsidy is determined transparently on the basis of the proportion of primary nutrients like Nitrogen (N), Phosphate (P), Potash (K) and Sulfur (S).
Along with the historic relief given to farmers, the Union Cabinet has also taken a major policy step in the interest of micro, small and medium entrepreneurs and self-employed small businessmen of the country. The Cabinet has given formal approval to the proposal to continue the ‘Credit Guarantee Fund for Micro Units (CGFMU) for the next five years i.e. till 31 March 2031. A special provision of a new fund of Rs 5,000 crore has been made for the smooth operation and financial strength of this scheme. This guarantee cover is provided to banks and non-banking financial institutions (NBFCs) through the National Credit Guarantee Trustee Company Limited (NCGTC), so that in case of any unexpected situation, the financial institutions get protection in case of non-repayment of loan and they can freely give loans to small businessmen.
The renewal of this fund will facilitate the distribution of new institutional loans worth about Rs 12.6 lakh crore across the country under the Pradhan Mantri Mudra Yojana (PMMY). This ambitious scheme, launched in January 2016, has transformed India’s grassroots entrepreneurship into a new revolution. According to government data, from the beginning of the scheme till September 2026, more than 60.36 crore loan applications have been approved by the lending banks and financial institutions. Due to this security cover, street vendors, small shopkeepers, rural artisans and women entrepreneurs of the country are getting easy institutional financial help to enhance their livelihood without any property or complex mortgage.
Many new provisions have been included in the restructuring of the scheme to connect citizens and women groups at the lowest rung of the society to the main financial stream. Under the revised rules, direct sovereign credit guarantee will now be given to very small enterprises on loans up to Rs 20 lakh. Apart from this, to strengthen financial inclusion, overdraft (OD) facility up to Rs 10,000 available on the bank accounts of Pradhan Mantri Jan Dhan Yojana (PMJDY) has also been protected under this credit guarantee cover. This will make the banking help available to common citizens in rural and semi-urban areas more convenient in case of emergency needs.
Giving priority to women empowerment, group loans given to Self Help Groups (SHGs) with a portfolio ranging from Rs 10 lakh to Rs 20 lakh have also been included in this guarantee mechanism. To reduce the financial burden on small entrepreneurs, the loan guarantee fee has been reduced from one percent per annum to only 0.75 percent. This entire concessional and extended arrangement will be equally applicable to all types of new loans distributed under the Pradhan Mantri Mudra Yojana from the financial year 2026-27 to 2030-31, which will take the participation of micro industries in the economic development of the country to a new height.