Government Boosts Farmers with Increased Minimum Support Prices
Every year, the Indian Government sets Minimum Support Prices (MSPs) for 22 agricultural crops, guided by the recommendations from the Commission for Agricultural Costs & Prices (CACP). This decision incorporates input from State Governments and various Central Ministries. The approach aims to ensure that farmers receive fair compensation for their produce, laying a strong foundation for the agricultural economy.
The Union Budget for 2018-19 established a significant policy framework, pledging to maintain MSPs at a minimum of one-and-a-half times the cost of production. Following this principle, the government has increased MSPs for all mandated crops, encompassing Kharif, Rabi, and other commercial varieties, resulting in a guaranteed profit margin of 50% above the national weighted average cost of production since the 2018-19 crop year.
To facilitate farmers, the government enables crop procurement through designated agencies, allowing farmers to choose between selling their harvest to these organizations or in the open market based on what is more beneficial for them. Key crops, including cereals and coarse cereals, are procured through the Food Corporation of India (FCI) and other state agencies to ensure price support for farmers.
The procurement of pulses, oilseeds, and copra occurs under the Price Support Scheme, aligned with the Pradhan Mantri Annadata Aay Sanrakshan Abhiyan (PM-AASHA). This initiative takes action whenever market prices for these products fall below the established MSP, ensuring farmers are protected against market volatility. Procurement agents for this scheme include the National Agricultural Cooperative Marketing Federation of India Ltd (NAFED) and the National Co-operative Consumers’ Federation of India Ltd (NCCF). Additionally, crops like cotton and jute are also supported through procurement strategies led by the Cotton Corporation of India (CCI) and Jute Corporation of India (JCI) respectively.
The impact of increased MSPs is evident, as shown by the significant figures from the 2024-25 crop year. Total procurement reached 1,223 lakh metric tons, translating into total MSP payments of ₹3.47 lakh crore to farmers, showcasing the government’s commitment to their welfare.
To further bolster the agricultural sector, the Government of India implements a variety of policies and support programs aimed at increasing agricultural production and ensuring farmers’ income stability. Some major initiatives include:
Key Initiatives for Farmers
1. National Food Security and Nutrition Mission (NFSNM)
2. National Mission on Edible Oils (NMEO)-Oil Palm
3. National Mission on Edible Oils (NMEO)-Oilseeds
4. National Mission on Natural Farming (NMNF)
5. Paramparagat Krishi Vikas Yojana (PKVY)
6. Soil Health & Fertility (SH&F)
7. Rainfed Area Development (RAD)
8. Agroforestry
9. Crop Diversification Programme (CDP)
10. Sub-Mission on Agriculture Extension (SMAE)
11. Sub-Mission on Seed and Planting Material (SMSP)
12. Mission for Integrated Development of Horticulture (MIDH)
13. National Bamboo Mission
14. National Bee Keeping and Honey Mission (NBHM)
15. Mission Organic Value Chain Development for North Eastern Region
16. Per Drop More Crop (PDMC)
17. Integrated Scheme for Agriculture Marketing (ISAM)
18. Pradhan Mantri Kisan Samman Nidhi (PM-KISAN)
19. Pradhan Mantri Kisan Maan Dhan Yojana (PM-KMY)
20. Pradhan Mantri Fasal Bima Yojana (PMFBY)/ Restructured Weather Based Crop Insurance Scheme (RWBCIS)
21. Pradhan Mantri Annadata Aay Sanrakshan Abhiyan (PM-AASHA)
22. Modified Interest Subvention Scheme (MISS)
23. Agriculture Infrastructure Fund (AIF)
24. Promotion of 10,000 new Farmer Producers Organizations (FPOs)
25. Agri Fund for Start-Ups & Rural Enterprises (AgriSURE)
26. Sub-Mission on Agriculture Mechanization (SMAM)
27. Digital Agriculture Mission
This comprehensive array of initiatives underscores the Indian government’s dedication to advancing farmers’ welfare, enhancing agricultural productivity, and ensuring fair compensation across the agricultural landscape.
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