The government has hiked the MSP of more than a dozen crops for Kharif Marketing Season (KMS) 2020-21

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  The government has hiked the MSP of more than a dozen crops for Kharif Marketing Season (KMS) 2020-21

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  1. Minimum Support Price (MSP): MSP is the price at which government purchases crops from the farmers, whatever may be the price for the crops. It incentivizes the framers and thus ensures adequate food grains production in the country.
  2. The MSP has been hiked in the range of 2%-7.5% for the kharif crops.
  3. The move is in accordance with Union Budget 2018-19 announcement of fixing the MSPs at a level of at least 1.5 times of the all-India weighted average cost of production.
  4. Experts say that this is not enough – there has to be large scale government procurement in most crops at MSP.
  5. How MSP is calculated for each crop - For the calculation of the MSP, the Commission for Agricultural Costs and Prices (CACP) takes into account a comprehensive view of the entire structure of the economy of a particular commodity or group of commodities. Commission makes use of both micro-level data and aggregates at the level of district, state and the country.
  6. National Commission on Farmers (NCF) - On November 18, 2004, the GOI formed the NCF, with MS Swaminathan as its chairman. Its aim was to come up with a system for sustainability in farming system and make it more profitable and cost competitive in farm commodities. The commission submitted five reports between December 2004 and October 2006. Its suggestions included fast and inclusive growth for farmers. The fifth and final report is considered the most crucial as it contains suggestions for the agriculture sector as a whole. It recommended that MSPs have to be at least 50% more than the cost of production.
  7. CAPC - It is a decentralized agency of the GOI. It was established in 1965 as the Agricultural Prices Commission, and was given its present name in 1985. It is an attached office of the Ministry of Agriculture and Farmers Welfare, GOI. It was established to recommend MSPs, to motivate cultivators and farmers to adopt the latest technology in order to optimize the use of resources and increase productivity.
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PT's IAS Academy: The government has hiked the MSP of more than a dozen crops for Kharif Marketing Season (KMS) 2020-21
The government has hiked the MSP of more than a dozen crops for Kharif Marketing Season (KMS) 2020-21
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