Government Announces New Minimum Support Prices for Crops
The Indian government has set new Minimum Support Prices (MSPs) for 22 agricultural crops, following recommendations from the Commission for Agricultural Costs and Prices (CACP). This decision aims to provide price stability for farmers and is based on consultations with state governments and relevant central ministries. The updated MSPs reflect changes in production costs over the past five years.
MSPs and Procurement Strategies
The government procures cereals and coarse cereals through the Food Corporation of India (FCI) and designated state agencies to ensure farmers receive fair prices. The procurement estimates for key crops like wheat and paddy are finalized in consultation with state governments and the FCI before each marketing season. This process takes into account the expected production, marketable surplus, and agricultural patterns.
States can also procure coarse grains at MSP under the central pool, provided they receive prior approval from the government on their procurement plans. This collaborative approach aims to enhance the efficiency of the procurement process and ensure that farmers benefit from the support prices.
Price Support Schemes for Pulses and Oilseeds
Under the Price Support Scheme, the government also procures pulses, oilseeds, and copra when market prices fall below the MSP. This initiative is part of the Pradhan Mantri Anna Data Aay Sanrakshan Abhiyan (PM-AASHA) and involves collaboration with state governments. The National Agricultural Cooperative Marketing Federation of India Ltd (NAFED) and the National Co-operative Consumers’ Federation of India Ltd (NCCF) are the primary agencies responsible for this procurement.
The overall quantity of procurement by the central government is limited to 25% of the total production of each commodity for the respective season or year. This measure is designed to prevent market distortions while providing necessary support to farmers.
Cotton and Jute Procurement Policies
In addition to cereals and pulses, the government also procures cotton and jute at MSP through the Cotton Corporation of India (CCI) and the Jute Corporation of India (JCI), respectively. Unlike other crops, there is no maximum limit on the quantity of cotton and jute that can be purchased from farmers. This policy aims to ensure that farmers in these sectors receive adequate support and can sustain their livelihoods.
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