The Centre on Wednesday hiked the subsidy on diammonium phosphate (DAP) fertilizer by a whopping 140%, from Rs 500 per bag to Rs 1,200 per bag, the Prime Minister’s Office (PMO) said in a statement. The decision was taken at a high-level meeting chaired by PM Narendra Modi, reported PTI.

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“A historic decision was taken to increase the subsidy for DAP fertiliser from Rs 500 per bag to Rs 1,200 per bag, which is an increase of 140%,” the PMO’s statement read.

“With today’s decision, farmers will continue to get a DAP bag for Rs 1,200,” the Prime Minister’s Office (PMO),” it said.

“Despite the rise in international market prices of DAP, it has been decided to continue selling it at the older price of Rs 1,200 per bag,” it further added.

This will cost the exchequer an additional Rs 14,775 crore.

After urea, DAP is the most widely used fertiliser in the country.

Last year, the actual price of DAP was Rs 1,700 per bag, on which the central government was giving a subsidy of Rs 500. The companies were therefore selling the fertiliser to farmers for Rs 1,200 per bag, the PMO’s statement read.

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The decision was taken amid ongoing tension between the Centre and the farmers over the three farm laws that were enacted last year.