Pricing farmer contributions under AIP

This policy note discusses a strategy that can be implemented readily and immediately, potentially still this year, to ensure that the budget allocated to fertilizer subsidies has the highest possible effect on food security in the country. It also discusses how the strategy, once adopted, can be used to phase out the AIP, while ensuring allocative efficiency within the program. This can be achieved by, each year, fixing the budget at a lower point and conducting the same optimization exercise.