As the Lok Sabha and state assembly elections draw near, the Indian union cabinet has given its nod to a 2-7% hike in the Minimum Support Price (MSP) for six essential crops. This decision is part of the government’s efforts to guarantee that farmers receive fair compensation for their agricultural produce.
The MSP serves as a critical safety net for farmers, offering them a guaranteed minimum income irrespective of market prices. It plays a pivotal role in supporting food security by motivating farmers to cultivate specific crops, thereby contributing to the stability of prices for staples like wheat, rice, and pulses.
Among the key crops, wheat and masoor dal are slated to see the most substantial increases, with their MSPs set to rise by 7% for the 2024-25 marketing season. This decision is expected to be well-received by farmers, particularly in light of the upcoming elections.
Specifically, the cabinet committee has increased the MSP for wheat to ₹2,275 per quintal from ₹2,125 in the previous season. For masoor dal, the MSP has been raised to ₹6,425 per quintal, up from ₹6,000 last season.
Other crops have also witnessed significant hikes in their respective MSPs. Barley’s MSP has been increased to ₹1,850 per quintal from ₹1,735 in the previous season, while chana (chickpeas) now has an MSP of ₹5,440, up from ₹5,335. For oilseed crops, the government has raised the MSP for rapeseed and mustard to ₹5,650 per quintal from ₹5,450 and safflower to ₹5,800 per quintal from ₹5,650 for the 2023-24 marketing season (October to March).
The rabi season, which encompasses the cultivation of crops during the winter months, contributes nearly half of India’s total food grain output. The cabinet committee’s approval of the MSP for rabi crops aligns with the standard process of setting these prices. In June, MSPs for kharif crops are approved, followed by the MSPs for rabi crops in October. These determinations are based on the recommendations of the Commission for Agricultural Costs and Prices (CACP).
The CACP adheres to a framework outlined in the Union Budget of 2018-19, which stipulates that MSPs must be set at a minimum of 1.5 times the all-India weighted average cost of production. This approach aims to ensure that farmers receive adequate compensation for their efforts and investment in crop cultivation.
The decision to raise MSPs for these crops is of significant importance, as it affects not only the livelihoods of millions of Indian farmers but also the stability of food prices in the country. By guaranteeing fair prices for agricultural produce, the government contributes to the well-being of farming communities and the food security of the nation, addressing crucial issues in the run-up to the upcoming elections.