Lok Sabha Question No. 1589 (UNSTARRED), answered on 2017-07-25
Subject: Growth of Farm  Income
Ministry: AGRICULTURE AND FARMERS WELFARE
Asked by: SRIRAM MALYADRI

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

## LOK  SABHA UNSTARRED QUESTION NO.1589

TO BE ANSWERED ON THE  25 TH  JULY, 2017

## GROWTH OF FARM INCOME

1589.  SHRI MALYADRI SRIRAM:

Will  the  Minister  of  AGRICULTURE  AND  FARMERS  WELFARE      ‡ãðŠãäÓã एवं  कसान कयाण ½ãâ¨ããè be pleased to state:

- (a) whether  the  Government  proposes  to  ensure  reasonable  farm  income  when there is a glut in crop produced by farmers in good monsoon year and if so, the details thereof;
- (b) whether it is a fact that the annual growth of farm income in real terms was only 1.6% between 2011-12 and 2015-16;

(c) the  reasons  advanced  by  the  Government  for  farmers  having  fared  poorly  in 2016-17 too, which was a good monsoon year;

(d) whether  the  Government  proposes  to  assure  a  massive  multifold  increase  in procurement at MSP in 2017-18; and

(e) if not, the reasons therefor ?

## ANSWER

MINISTER OF  STATE IN THE  MINISTRY OF  AGRICULTURE AND  FARMERS  WELFARE

‡ãðŠãäÓã एवं  कसान  कयाण ½ãâ¨ããÊã¾ã  ½ãñâ  Àã·¾ã  ½ãâ¨ããè (  SHRI PARSHOTTAM RUPALA)

- (a): The  Government  fixes  Minimum  Support  Prices  (MSPs)  for  major  agricultural crops to ensure remunerative prices for farmers on the recommendation of Commission for Agricultural Costs & Prices (CACP).

The  Government  had  increased  the  Minimum  Support  Prices  (MSPs)  of  both Rabi and Kharif crops for 2016-17 season. Further, to incentivize cultivation of pulses and  oilseeds  in  the  country,  Government  had  announced  a  bonus  of  Rs.  425/-  per quintal for Kharif pulses, namely Arhar (Tur), Urad and Moong, a bonus of Rs. 200/- per quintal  for  Sesamum  and  a  bonus  of  Rs.  100/-  per  quintal  for  other  Kharif  oilseeds namely,  Groundnut-in-shell,  Sunflowerseed,  Soyabean,  and  Nigerseed.  Government had also announced bonus of Rs. 200/- per quintal and Rs. 150/- per quintal  for  rabi pulses viz. Gram and  Masur (Lentil)  respectively  and a  bonus of  Rs. 100/- per quintal

each for both Rabi oilseeds namely, Rapeseed/Mustard and Safflower. The Government  has  also  increased  the  MSPs  of  Kharif  crops  for  2017-18  season.  In addition,  Government  has  also announced a  bonus  of  Rs. 200/- per quintal  for  Arhar (Tur),  Urad  and  Moong,  Groundnut-in-shell,  Soyabean  and  a  bonus  of  Rs.  100/-  per quintal  for  Sunflower  Seed,  Sesamum  and  Nigerseed  for  2017-18  season.The  MSPs fixed by the Government provide adequate returns over all India weighted average, all paid  out  costs  including  family  labour  (A2+FL)  as  estimated  by  the  CACP.  The Government  offers  to  procure  crops  at  MSP.  However,  farmers  are  free  to  sell  their produce to  the  Government  procurement  agencies  at  MSP  or  in  the  open  market  as advantageous to them.

The Government implements the Price Support Scheme (PSS) for procurement of  oil  seeds,  pulses  and  cotton  through  Central  Nodal  Agencies,  at  the  Minimum Support Price (MSP) declared by the Government. This scheme is implemented at the request  of  the  concerned  state  government  which  agrees  to  exempt  the  procured commodities  from  levy  of  mandi  tax  and  assist  central  nodal  agencies  in  logistic arrangements including gunny bags, provide working capital for state agencies, creation of revolving fund for PSS operations etc. as required under the Scheme guidelines. The basic  objectives  of  PSS  are  to  provide  remunerative  prices  to  the  growers  for  their produce with a view to encourage higher investment and production and to safeguard the  interest  of  consumers  by  making available  supplies  at  reasonable  prices  with  low cost of intermediation.

Government implements Market Intervention Scheme (MIS) for procurement of agricultural  and  horticultural  commodities  which  are  perishable  in  nature  and  are  not covered  under  the  Price  Support  Scheme  (PSS).  The  objective  of  intervention  is  to protect the growers of these commodities from making distress sale in the event of a bumper crop during the peak arrival period when the prices tend to fall below economic levels and cost of production. The condition is that there should be either at least a 10 percent increase in production or a 10 percent decrease in the ruling market prices over the  previous  normal  year.  The  scheme  is  implemented  at  the  request  of  a  State/UT Government, which is ready to bear 50 percent of the loss (25 percent in case of NorthEastern States), if  any,  incurred  on  its  implementation.  The  extent  of  total  amount  of loss  to  be  shared  on  a  50:50  basis  between  the  Central  Government  and  the  State Governments  and  is  restricted  to  25  percent  of  the  total  procurement  value  which includes cost of the commodity procured plus permitted overhead expenses. Under the scheme,  in  accordance  with  MIS  guidelines,  a  pre-  determined  quantity  at  the  fixed Market  Intervention  Price  (MIP)  is  procured  by  the  agencies  designated  by  the  State Government for a fixed period or till the prices are stabilized above the MIP whichever is earlier. The area of operation is restricted to the concerned state only.

(b) & (c): The National Sample Survey Office (NSSO) conducted 'Situation Assessment Survey (SAS) of Agricultural Households' during NSS 70 th round (January 2013- December 2013) in the rural areas of the country with reference to the agricultural year  July  2012-  June  2013.  The  survey  estimated  the  average  monthly  income  per agricultural household as Rs.6426/-. As per SAS of Agricultural Households during NSS 59 th round (January 2003-December 2003), the estimated average monthly income per agricultural household was Rs.2115/- in 2003. As regards, the average growth rate of agriculture  and  allied  sector,  this  sector  has  witnessed  a  significant  improvement  of growth of 4.4 percent in 2016-17 at 2011-12 basic prices following the normal monsoon.

(d) & (e): Government undertakes procurement of wheat and paddy under its 'MSP operations'.  A  total  quantity  of  308.25  Lakh  Metric  Ton  (LMT)  of  wheat  has  been procured  in  Rabi  Marketing  Season (RMS) 2017-18  till  20.07.2017,  which  is  highest during the last 5 years. A total quantity of 386.73 LMT of paddy/rice has been procured in Kharif Marketing Season (KMS) 2016-17 till 21.07.2017, which is highest during the last 10 years. As of now, KMS 2017-18 has not started.

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