In the case of fertilisers, unlike other forms of subsidy, the government provides subsidy to the manufacturers and not the farmers, allowing inefficient production units to thrive in the system. The Standing Committee on Chemicals and Fertilizers convened in March 2020 to recognise these challenges and called for a framework to adopt direct cash transfer into farmers’ accounts. This policy change will require the states to prepare against three key parameters—physical infrastructure, financial inclusion, and farmer identification—to target the beneficiaries. Using secondary institutional data, this paper explores the digital readiness of various states to transition to DCT and the challenges they face.
