Fertilizer subsidy policy in Bangladesh

Fertilizer subsidy policy is highly discussed topic in the world as well as in Bangladesh. Because of the importance of fertilizers in increasing agricultural output, government intervention in the fertilizer market is gaining popularity since past decades. The country is implementing a universal subsidy policy under which each and every farmer can avail the subsidy through using fertilizers for farming. In the meantime, the government faces great difficulty with the increasing expenditure on the fertilizer subsidy due to its fiscal implications. Ineffective implementation using large amounts of scarce resources to subsidize fertilizer could bring very little gains, in fact. Within the policy setup, the basic question is whether the fertilizer subsidy is benefitting the intended farmers who are really in need of this subsidy. An analysis of whether subsidy provides benefits to the poor farm holders is presented in this book. Moreover, the reasons for variation in fertilizer usage among the farm households while they all are receiving subsidy under the common policy setup are explained. As the quality of subsidized fertilizers is deteriorated at the farm level, farmers’ willingness-to-pay for quality fertilizers at the farm level has also been assessed. Thus, this book provides an elaboration of different policy measures that can be used as alternatives to the existing fertilizer subsidy policy.