PM Programme for Restoration, Awareness Generation, Nourishment, and Amelioration of Mother Earth (PM-PRANAM)

Overview

PM-PRANAM (PM Programme for Restoration, Awareness Generation, Nourishment, and Amelioration of Mother Earth) is a Central Government scheme announced in the Union Budget 2023-24 and formally approved by the Ministry of Chemicals and Fertilizers on 28 June 2023. It incentivises States and Union Territories to reduce the consumption of chemical fertilizers (urea, DAP, NPK, MOP) by sharing 50% of the resultant fertilizer subsidy savings with the state that achieves the reduction.

The scheme operates for a period of three years (FY 2023-24 to FY 2025-26) and has no separate budgetary allocation — it is entirely financed through the savings generated from existing fertilizer subsidy schemes under the Department of Fertilizers. In its first year of operation (FY 2023-24), PM-PRANAM contributed to a reduction of 15.14 lakh tonnes of chemical fertilizers, generating subsidy savings of approximately Rs 3,157 crore.

How the Scheme Works

Subsidy Savings Calculation

Each State’s/UT’s chemical fertilizer consumption (urea, DAP, NPK, MOP) is compared against its average consumption over the previous three years. If a State reduces its consumption below this three-year average, the resulting subsidy saving is calculated.

Grant Distribution

• 50% of the fertilizer subsidy saved by a State/UT in a financial year is passed on to that State/UT as a grant
• Of this grant:
  • 95% is allocated to the State
  • 5% is retained by the Centre for disaster-adjusted incentives (to account for states affected by natural calamities that may cause abnormal fertilizer consumption)

Utilisation of Grant

The grant received by States must be used as follows:

• 70% for asset creation related to technological adoption of alternate fertilizers and setting up alternate fertilizer production units at village, block, and district levels
• 30% for rewarding and incentivising farmers, panchayats, Farmer Producer Organisations (FPOs), and Self-Help Groups (SHGs) involved in reduction of chemical fertilizer use and awareness generation

Objectives

• Promote balanced and sustainable use of chemical fertilizers alongside bio-fertilizers, organic fertilizers, and nano fertilizers
• Reduce India’s dependence on imported fertilizers (India imports nearly 100% of potash and about 60% of phosphatic fertilizers)
• Address soil degradation caused by excessive and imbalanced chemical fertilizer use
• Generate awareness about regenerative agriculture practices
• Complement allied initiatives like the Soil Health Card Scheme, Paramparagat Krishi Vikas Yojana (PKVY), and Natural Farming Mission

Current Status and Challenges

Disbursement Issue

As of February 2026, the Centre has not yet disbursed incentive grants to any State/UT under PM-PRANAM, despite the scheme being operational since FY 2023-24. Union Health and Chemicals Minister J.P. Nadda confirmed this in a parliamentary reply. The delay raises questions about the scheme’s implementation effectiveness.

Context: India’s Fertilizer Subsidy Burden

India’s fertilizer subsidy for FY 2025-26 is budgeted at approximately Rs 1,67,887 crore. Urea alone accounts for about Rs 1,19,000 crore. The retail price of urea has remained fixed at Rs 242 per 45 kg bag since March 2018. This massive subsidy burden — combined with environmental damage from overuse — makes PM-PRANAM’s objective of reducing chemical fertilizer consumption strategically significant.

Latest Developments

• No incentive grants disbursed to any State/UT as of February 2026 despite the scheme being operational since FY 2023-24 — confirmed by Union Health and Chemicals Minister J.P. Nadda in a parliamentary reply
• FY 2023-24 results: Chemical fertilizer consumption reduced by 15.14 lakh tonnes, generating estimated subsidy savings of approximately Rs 3,157 crore
• DAP special package extended — Union Cabinet approved extension of the one-time special package on DAP (Diammonium Phosphate) till December 2025, with an estimated budget of Rs 3,850 crore to ensure affordable availability
• Scheme in its final year — PM-PRANAM operates for 3 years (FY 2023-24 to FY 2025-26); no announcement on extension beyond 2025-26 as of March 2026
• India’s fertilizer subsidy for FY 2025-26 budgeted at approximately Rs 1,67,887 crore (urea alone: ~Rs 1,19,000 crore), making the PM-PRANAM objective of reducing consumption strategically critical
• Nano Urea and Nano DAP adoption growing — complementary to PM-PRANAM goals, IFFCO’s nano fertilizers are being promoted as alternatives to conventional chemical fertilizers across states
• Implementation gap concern: Despite positive fertilizer reduction data, the non-disbursement of grants raises questions about the gap between scheme design and actual execution

Prelims Importance

• PM-PRANAM was announced in Union Budget 2023-24 and approved on 28 June 2023
• Full form: PM Programme for Restoration, Awareness Generation, Nourishment, and Amelioration of Mother Earth
• Nodal ministry: Department of Fertilizers, Ministry of Chemicals and Fertilizers
• No separate budget — funded entirely from fertilizer subsidy savings
• 50% of subsidy savings passed to the State that achieves the reduction
• Of the grant: 70% for asset creation (alternate fertilizer infrastructure), 30% for rewarding farmers/panchayats/FPOs/SHGs
• Duration: 3 years (FY 2023-24 to FY 2025-26)
• FY 2023-24 achievement: 15.14 lakh tonne reduction in chemical fertilizer consumption
• Target: Rs 20,000 crore reduction in fertilizer spending (long-term)
• Chemical fertilizers tracked: Urea, DAP, NPK, MOP
• As of February 2026, no incentive grants have been disbursed to States/UTs
• 95% of grant goes to State; 5% retained by Centre for disaster adjustment

Mains & Interview Importance

GS Paper 3 — Agriculture, Environment, Economy

• Critically analyse PM-PRANAM as a demand-side intervention to reduce fertilizer subsidies — is incentivising states sufficient, or does India need supply-side reforms (decontrol of urea pricing)?
• Evaluate the scheme’s complementarity with other initiatives: Soil Health Card, Paramparagat Krishi Vikas Yojana (PKVY), Natural Farming Mission, and Nano Urea
• Discuss the environmental and economic consequences of India’s fertilizer subsidy regime — soil degradation, water pollution, fiscal burden, and import dependence
• Assess whether PM-PRANAM can address the regional imbalance in fertilizer use (Punjab and Haryana overuse vs NER underuse)

Interview Angles

• “PM-PRANAM has no separate budget and depends on subsidy savings. Is this a strength (self-financing) or a weakness (no guaranteed funding for states)?”
• “Despite positive fertilizer reduction data, no incentive grants have been disbursed. What does this tell us about the gap between scheme design and implementation in India?”
• “Can India simultaneously maintain food security and reduce chemical fertilizer use? What is the role of nano fertilizers and bio-fertilizers in bridging this gap?”

Sources: PIB, Department of Fertilizers, IBEF, Daily Excelsior