Lok Sabha Question No. 1054 (UNSTARRED), answered on 2016-11-22
Subject: Increase in Cost of Production of Agriculture
Ministry: AGRICULTURE AND FARMERS WELFARE
Asked by: MALLIKARJUN  KHARGE, ASHOK MAHADEORAO NETE, OM BIRLA, M. K. RAGHAVAN

## GOVERNMENT OF INDIA MINISTRY OF AGRICULTURE AND FARMERS WELFARE DEPARTMENT OF AGRICULTURE, COOPERATION AND FARMERS WELFARE

## LOK  SABHA UNSTARRED QUESTION NO.1054

TO BE ANSWERED ON THE 22 ND  NOVEMBER, 2016

## INCREASE IN COST OF PRODUCTION OF AGRICULTURE

1054.     SHRI MALLIKARJUN KHARGE: SHRI ASHOK MAHADEORAO NETE: SHRI OM BIRLA: SHRI M.K. RAGHAVAN:

Will the Minister of AGRICULTURE AND FARMERS WELFARE कृ ष एवं कसान कयाण मंी be pleased to state:

- (a) whether the growth rate of MSP for several crops has been lower whereas input cost of agriculture has increased many fold, if so, the details thereof;
- (b) whether  agriculture  is  becoming  unremunerated  for  small  and  marginal  farmers  on account of decreasing holding size, increase in the cost of agricultural inputs and environmental risk factors on the crops, if so, the details thereof along with the steps taken or proposed to be taken by the Government to bring down the cost of production;
- (c) whether any comparative study has been commissioned to examine the input cost for cultivation of major crops, vis-avis MSP fixed for each crop and if so, the details thereof;
- (d) the steps taken by the Government to reduce the input costs of agriculture like the usage and prices of fertilizers,  pesticides, seeds etc. and implement the recommendations made by the National Commission on Farmers and provide maximum benefit to the farmers; and
- (e) the  details  of  various  works  carried  out  by the  Government  in  view  of  the  proposal  to double the income of farmers?

## ANSWER

## MINISTER OF STATE IN THE MINISTRY OF AGRICULTURE AND FARMERS WELFARE

कृ ष एवं कसान कयाण मंालय म राय मंी (SHRI  S.S. AHLUWALIA)

(a) to (c): Cost  of  production  is  one  of  the  important  factors  taken  by  Commission  for Agricultural Costs and Prices (CACP) in determination of Minimum Support Prices (MSPs).

Details of all-India weighted average cost of production including family labour (A2+FL) and MSPs for major agricultural crops from 2014-15 to 2016-17 are given at Annexure.

A study conducted by NITI Aayog on efficacy of MSP has found that MSP declared by the  Government  has  encouraged  78%  of  the  farmers  including  small  and  marginal  farmers covered  under  the  study  for  adopting  improved  methods  of  farming  such  as  high  yielding varieties  of  seeds, organic  manure,  chemical  fertilizer,  pesticides  and  improved methods of

harvesting  etc.  due  to  remunerative  price.  The  study  has  also  revealed  that  majority  of  farm households are in favour of MSP since it ensures guaranteed income to the farmers by acting as a floor price.

Under Comprehensive Scheme for Studying the Cost of Cultivation of Principal Crops, the cost data for all the important crops are collected on a sample basis by State Agricultural Universities/Institutions  located  in  various  states  and  the  cost  data  for  all  major  crops  are continuously updated, which form the basis for recommending MSPs by CACP.

(d) & (e): Government has taken several initiatives to reduce input costs of agriculture which inter  alia  includes  Soil  Health  Card,  Pradhan  Mantri  Krishi  Sinchai  Yojana  (PMKSY),  Neemcoated Urea (NCU), Bio Pesticides for promoting Integrated Pest Management, Production of Quality Seeds, Promoting water saving devices like sprinkler sets, drip irrigation systems, water carrying pipes/ underground pipelines etc.

Government has also initiated various schemes to increase the income of farmers which inter  alia  includes  Special  focus  on  irrigation  with  sufficient  budget  with  the  aim  of  'Per  Drop More Crop', Provision of quality seeds and nutrients based on soil health of each field, large investments in Warehousing and Cold Chains to prevent post- harvest crop losses, Promotion of value addition through Food Processing, Creation of a National Farm Market,  Introduction of a  New  Crop  Insurance  Scheme  to  mitigate  risks  at  affordable  cost,    Promotion  of  ancillary activities like Poultry, Beekeeping and Fisheries etc.

Annexure Annexure  referred  to  in  reply  to  parts  (a)  to  (c)  of  the  Lok  Sabha  Unstarred  Question

No.1054 due for reply on 22.11.2016

|    | CROPS                  | 2014-15   | 2014-15   | 2015-16   | 2015-16   | 2016-17   | 2016-17   |
|----|------------------------|-----------|-----------|-----------|-----------|-----------|-----------|
|    |                        | A2+FL     | MSP       | A2+FL     | MSP       | A2+FL     | MSP       |
| 1  | PADDY                  | 978       | 1360      | 1020      | 1410      | 1045      | 1470      |
| 2  | WHEAT                  | 744       | 1450      | 785       | 1525      | 797       | 1625      |
| 3  | MAIZE                  | 914       | 1310      | 941       | 1325      | 966       | 1365      |
| 4  | ARHAR(Tur)             | 3105      | 4350      | 3237      | 4625^     | 3241      | 5050^^    |
| 5  | MOONG                  | 3890      | 4600      | 3993      | 4850^     | 4065      | 5225^^    |
| 6  | GRAM                   | 1902      | 3175      | 2124      | 3500 *    | 2241      | 4000^     |
| 7  | MASUR (LENTIL)         | 1866      | 3075      | 2015      | 3400 *    | 2174      | 3950&     |
| 8  | GROUNDNUT IN SHELL     | 3232      | 4000      | 3314      | 4030      | 3371      | 4220**    |
| 9  | RAPESEED/MUSTARD       | 1504      | 3100      | 1702      | 3350      | 1871      | 3700**    |
| 10 | COTTON (Medium Staple) | 2510      | 3750      | 2753      | 3800      | 2889      | 3860      |
|    | (Long Staple)          | 2510      | 4050      | 2753      | 4100      | 2889      | 4160      |

^Including bonus of Rs. 200 per quintal ^^Including bonus of Rs.425 per quintal *Including bonus of Rs.75 per quintal **Including bonus of Rs.100 per quintal & Including bonus of Rs.150 per quintal

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