Partner With Us NRI

Open Free Trading Account Online with ICICIDIRECT

Incur '0' Brokerage upto ₹500


Nano DAP approval likely to have positive implications for subsidy burden, farmer's income

ICICIdirect Research 06 Mar 2023 DISCLAIMER

What's Buzzing? 

After Nano Urea, the government has provided approval for Nano DAP (Di-ammonium phosphates) for three years. The government has given IFFCO and Coromandel International permission to begin producing nano-DAP, subject to their respective compliance. Paradeep Plant of IFFCO is expected to commence producing Nano-DAP in the coming months. 


Conventional DAP is the second most consumed fertiliser after urea. Annual DAP consumption is ~12 million tonnes, which is catered through domestic production of ~5 million tonnes while the rest is being imported. Nano DAP is estimated to be available from 2023 kharif season and is expected to cost at Rs 600 (without subsidy) per bottle containing 500 ml, which is equivalent to one 50 kg bag of conventional DAP costing Rs 1,350 (Rs 4000 before subsidy). Since nano-DAP is projected to cost less than traditional DAP, this may aid the government in lowering its subsidy besides import substitution. For FY24, the government’s fertilisers subsidy target is Rs 1.71 lakh crore of which the non-urea portion was Rs 0.40 lakh crore. 

Our Perspective 

Besides benefits on the subsidy and exchequers front, the usage of Nano-DAP is expected to bring benefits at the farm level. According to some estimates, its application is expected to raise yields anywhere of 3-16%, bringing in an extra Rs 2,500 to Rs 5,000 benefits per acre for farmers. Similarly, Nano DAP is suitable for all crops as seed primer, growth enhancer, and productivity and quality booster. It has a nutrient use efficiency (NUE) of more than 90%. Extensive testing has demonstrated that DAP improves root development and plant growth, enhances crop productivity and quality among others. Logistically also it is convenient to transport and relatively easy to handle.

Download App

Download Our App

Play Store App Store
market app