Presentation on DBT in Fertilizers

Presentation

on

DBT in Fertilizers

27.09.2019

Department of 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

Slide2

Why DBT in Fertilizers?

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”


• 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.

Slide4

DBT in Fertilizers : Pilot Initiaive


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.

Slide5

DBT in Fertilizers


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.

Slide6


Subsidy for Urea manufactured by NFL

Slide7

Plant Subsidized Price (MRP**)

Subsidy component

Market Price of 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.

Slide8


Fertilizer Sale to Farmer through PoS Device

Buyer visits Retailer

Retailer asks for his Aadhaar No.

Buyer shares

Voter ID or KCC

NO

Sale transaction details are entered

Authentication done through Aadhaar

Demographic records are

captured using e-KYC

Land Records Database & SHC Database

YES

Retailer logins with Biometric Aadhaar

Authentication

Sale Completed

Recommendations from Land records and Soil

Health card

UIDAI Database

Aadhar request for verification

through KSA

CSC Server as ASA

mFMS (DoF) Server

Slide9


DBT Rollout in pilot districts: Status

Slide10

Sr.

No

District Retailers / PoS

Required

PoS Received /

Deployed

Master

Training

DBT Status

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

Live (1st Jan. 2017) 4 Hoshangabad (MP) 246 217/214 Completed

5 Pali (Rajasthan) 343 343/270 Completed

6 Kishanganj (Bihar) 349 344/308 Completed

Live (1st Feb. 2017)

7 Karnal (HR) 772 772/688 Completed

8 Kurukshetra (HR) 550 520/506 Completed

9 Nasik (Maharashtra) 1346 1200/1200 Completed

10 Raigarh (Maharashtra) 200 200/200 Completed

11 Rangareddy (Telangana) 205 205/184 Completed

Live (1st Mar. 2017) 12 Tumkur (Karnataka) 533 305/282 Completed

13 Narmada, (Gujarat) 95 95/95 Completed

14 Thrissur, (Kerala) 178 200/200 Completed

15 Dhanbad, (Jharkhand) 58 58/52 Completed

Live (1st Aug. 2017) 16 Begusarai, (Bihar) 694 694/546 Completed

17 Gorakhpur, (UP) 1488 1340/1020 Completed

18 Malda, (WB) 1445 785/666 Went Live with the State of West Bengal

19 South 24Parganas,WB) 2395 2305/1106 Went Live with the State of West Bengal

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.

Slide11


Evaluation Studies & Feedback : 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.

Slide12


S. No. States / UT Go Live Date

1. 17 Pilot District in Various States 1st Oct 2016 ~

1st Aug 2017

2. NCT of Delhi live on DBT in fertilizers 1st September, 2017

3. Mizoram, , Daman & Diu, Dadra Nagar Haveli,

Manipur, Nagaland, Goa, Puducherry (7 UTs/ States) 1st October, 2017

4. Rajasthan, Uttarakhand, Maharashtra, Andaman &

Nicobar, Tripura, Assam (6 UTs/ States)

1st November, 2017

5. Andhra Pradesh, Haryana, Punjab, Chhattisgarh,

Madhya Pradesh (5 States) 1st December, 2017

6. Kerala, Bihar, Karnataka, Jharkhand, Telangana, Tamil

Nadu (6 States)

1st January, 2018

7. Uttar Pradesh, West Bengal, Odisha, Gujarat, Himachal

Pradesh (5 States)

1st February, 2018

8. Jammu & Kashmir 1st March 2018

PAN India DBT Rollout Status


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

Slide14


Key Stakeholders

Slide15

Farmers

1

5

4

2

3

Dept. of Fertilizers

Wholesalers & Retailers

State Governments

NIC & other IT partners

FAI/

Fertilizer Companies

.


DBT implementation - Key activities

Slide16

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..


Operational Challenges

Slide17

•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.”

Department of Fertilizers Slide18

•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.




Slide20

Grievance Redressal Mechanism:

• What’s app

• DBT PMU.

• NIC Support Team

• 15 member Multi-lingual Help Desk.


Potential Benefits of DBT

Slide 21

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.


•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.

Slide22

Comparison of Payment under DBT


Features of DBT: Bill tracking

Payments under DBT system are faster, transparent & more efficient as compared to the previous system.


Process Re-engineering

Slide24

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.

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

https://urvarak.nic.in

https://urvarak.nic.in/

Dashboards : PAN India Fertilizer Requirement & Availability

Dashboards : PAN India Retailer Sales


Dashboard for States

Slide30

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

Slide35

• 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.


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.

Slide36

DBT initiatives in pipeline


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

Slide37

DBT in Fertilizers : Scale of Operation & Present Status


THANK YOU


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

Slide39

Evaluation Studies & Feedback :

4th Round (limited to 18 states and 54 districts – July-Sept.’2018)


DBT Rollout in pilot districts: Status

Slide40

Sr.

No

District Retailers / PoS

Required

PoS Received /

Deployed

Master

Training

DBT Status

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

Live (1st Jan. 2017) 4 Hoshangabad (MP) 246 217/214 Completed

5 Pali (Rajasthan) 343 343/270 Completed

6 Kishanganj (Bihar) 349 344/308 Completed

Live (1st Feb. 2017)

7 Karnal (HR) 772 772/688 Completed

8 Kurukshetra (HR) 550 520/506 Completed

9 Nasik (Maharashtra) 1346 1200/1200 Completed

10 Raigarh (Maharashtra) 200 200/200 Completed

11 Rangareddy (Telangana) 205 205/184 Completed

Live (1st Mar. 2017) 12 Tumkur (Karnataka) 533 305/282 Completed

13 Narmada, (Gujarat) 95 95/95 Completed

14 Thrissur, (Kerala) 178 200/200 Completed

15 Dhanbad, (Jharkhand) 58 58/52 Completed

Live (1st Aug. 2017) 16 Begusarai, (Bihar) 694 694/546 Completed

17 Gorakhpur, (UP) 1488 1340/1020 Completed

18 Malda, (WB) 1445 785/666 Went Live with the State of West Bengal

19 South 24Parganas,WB) 2395 2305/1106 Went Live with the State of West Bengal

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 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.

Slide41


Evaluation Studies & Feedback : 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.

Slide42


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

Slide43

Evaluation Studies & Feedback :

4th Round (limited to 18 states and 54 districts – July-Sept.’2018)

44 Department of Fertilizers

Operational Challenges & Action Taken by DOF

Sr. Operational challenges Action taken by DoF

1. Improved transaction time and requirement of Aadhaar authentication

Transaction time has improved from 10 Min to 3 Min.

2. Server and connectivity problems (Need to come repeatedly to retailer shop )

•Multiple connectivity options such as Wifi, LAN, PSTN are being provided. •Option of external antenna. •Software and hardware enhanced at server end.

3. Various operational issues such as stock problems, receipt acknowledgement etc.

RO module developed for capturing real time fertilizer movement & stock updation.

4. Ineffective grievance redressal 15 Member Multilingual Help Desk set up.

5. Sale of fertilizers during Peak Season and heavy rush.

Facility for having multiple PoS (5 devices) at retailer point provided.

Presentation on DBT in Fertilizers

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