Increase in Minimum Support Price (MSP)
The Government of India has significantly increased its budget allocation for the Department of Agriculture and Farmers Welfare (DA&FW), raising it from ₹21,933.50 crore in 2013-14 to an impressive ₹1,37,756.55 crore for the fiscal year 2025-26. This financial boost supports various initiatives aimed at enhancing farmers’ incomes, particularly for small and marginal farmers. Key programs include the Pradhan Mantri Kisan Samman Nidhi and the Pradhan Mantri Fasal Bima Yojana, among others, all designed to foster agricultural development across the country.
Government Initiatives to Support Farmers
The Indian government has launched several schemes to uplift the agricultural sector and improve the livelihoods of farmers. Among these, the Pradhan Mantri Kisan Samman Nidhi (PM-KISAN) provides direct income support to farmers, ensuring they receive financial assistance for their agricultural activities. Additionally, the Pradhan Mantri Kisan Maan Dhan Yojana (PM-KMY) aims to provide old-age pensions to small and marginal farmers, promoting financial security in their later years.
Another significant initiative is the Pradhan Mantri Fasal Bima Yojana (PMFBY), which offers insurance coverage for crops, protecting farmers against losses due to natural calamities. The Modified Interest Subvention Scheme (MISS) also plays a crucial role by providing interest subsidies on agricultural loans, making it easier for farmers to access credit. Furthermore, the Agriculture Infrastructure Fund (AIF) is set up to enhance the agricultural infrastructure, facilitating better storage and marketing of produce.
Minimum Support Prices and Their Impact
The government fixes Minimum Support Prices (MSPs) for 22 mandated agricultural crops, ensuring that farmers receive a fair price for their produce. This pricing mechanism is based on recommendations from the Commission for Agricultural Costs and Prices (CACP) and takes into account the views of state governments and relevant ministries. The Union Budget for 2018-19 established a principle to maintain MSPs at one and a half times the cost of production, which has been implemented since the 2018-19 season.
To enhance the effectiveness and transparency of MSPs, a committee was formed in July 2022. This committee is tasked with providing suggestions to grant more autonomy to the CACP and to strengthen the agricultural marketing system. The goal is to ensure that farmers can take advantage of both domestic and export opportunities, thereby securing better prices for their crops.
Future Prospects for Agricultural Development
The government continues to focus on various programs aimed at sustainable agricultural practices and enhancing productivity. Initiatives such as the National Mission on Natural Farming and the Digital Agriculture Mission are designed to promote eco-friendly farming techniques and the use of technology in agriculture. Additionally, the National Bee Keeping and Honey Mission aims to boost honey production and improve the livelihoods of beekeepers.
The formation and promotion of 10,000 new Farmer Producers Organizations (FPOs) is another strategic move to empower farmers by enabling them to collectively market their produce. This approach not only enhances their bargaining power but also facilitates better access to resources and information. As these initiatives unfold, they are expected to significantly contribute to the growth and sustainability of the agricultural sector in India, ultimately benefiting millions of farmers across the nation.
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