The Cabinet committee on economic affairs announced increase in minimum support price (MSP) on Monday for crucial Rabi crops, including wheat, for the 2020-21 marketing season. The decision has come after Prime Minister Narendra Modi recently told that MSP for farm products would continue under new farm bills.
The minimum support price is the rate at which government acquires crops from farmers when prices fall below market price because of high supply.
MSP on wheat has been increased by 2.6% year on year to Rs 1975 per quintal. For gram, the hike is 8.3% and 7% for mustard and rapeseed. For barley, the hike is Rs 75 to Rs 1600 per quintal. Committee hiked MSP of mustard by Rs 225 to Rs 4650 per quintal, while Masur MSP was increased by Rs 300 to Rs 5100 per quintal and sunflower by Rs 112 to Rs 5327 per quintal.
The increase in MSP is inclined with Swaminathan’s recommendations that said MSP should be at least 50% higher than the production cost, and the differential wages are aimed at inspiring crop diversification. It is also in line with the Government’s aim to double the farmers’ income by 2022.
Agriculture Minister Narendra Singh Tomar said that the MSP price hike's announcement would help farmers decide on their crop structure. MSP for pulses and oilseeds has been increased to boost more production so that import of these products will be reduced.
The recent price announcement is proof that the Agriculture Produce Market Committee [APMC] mandis will continue. Nevertheless, farmers will be free to sell their crops anywhere throughout the country to get the best remunerative prices.
Prime Minister Narendra Modi said that Government would continue to make the country’s farmers self-sustaining policy in the country’s farming. He assures that the MSP system will continue to operate as before. The Government procurement will also continue every season, as run before.
