Lok Sabha Question No. 616 (UNSTARRED), answered on 2017-12-19
Subject: Fixation of MSP for Agricultural Produce
Ministry: AGRICULTURE AND FARMERS WELFARE
Asked by: MAUSAM NOOR, SONA RAM CHOUDHARY

## GOVERNMENT OF INDIA

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

## LOK  SABHA UNSTARRED QUESTION NO.616

TO BE ANSWERED ON THE 19 TH   DECEMBER, 2017

## FIXATION OF MSP FOR AGRICULTURAL PRODUCE

616. SHRIMATI MAUSAM NOOR: COL. SONARAM CHOUDHARY:

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

- (a) the policy for fixing Minimum Support Price for agricultural produces and the mechanism in place for the purpose;
- (b) whether  the  Government  had  acknowledged  the  recommendations  made  by  Ramesh Chand Committee which studied the issues concerning farmers and agriculture;
- (c) if so, the details of the observations analyzed and accepted by the Government;
- (d) whether the recommendation on revised calculation of Minimum Support Price (MSP) by computing  farm  labour  at  the  skilled  wage  rate  and  other  inputs  has  been  accepted  by  the Government;
- (e) if  so,  whether  the  revision  of  Minimum  Support  Price  has  brought  about  necessary changes bringing relief to the farmers by the resultant increase in Minimum Support Price by over 50 percent; and
- (f) if so, the reasons therefor?

## ANSWER

MINISTER OF STATE IN THE MINISTRY OF AGRICULTURE AND FARMERS WELFARE कृ ष एवं कसान कयाण मंालय म राय मंी (SHRI  GAJENDRA SINGH SHEKHAWAT)

- (a): Government fixes Minimum Support Prices (MSPs) for agricultural produce on the basis of the recommendations of the Commission for Agricultural Costs & Prices (CACP), after obtaining the views of State Governments and Central Ministries/Departments and other relevant factors. While recommending  MSPs,  CACP  takes  into  account  the  cost  of  production,  overall  demand-supply conditions,  domestic  and  international  prices,  inter-crop  price  parity,  terms  of  trade  between agricultural  and  non-agricultural  sectors,  the  likely  effect  on  the  rest  of  the  economy,  besides ensuring  rational  utilization  of  productive  resources  like  land  and  water.    CACP  also  holds consultations with various stakeholders including State governments and farmers' representatives before finalizing its recommendations.
- (b)  to  (f):    Committee  constituted  in  2013  by  the  Government  under  the  Chairmanship  of  Prof. Ramesh Chand, the then Director, National Institute of  Agricultural Economics and Policy (NCAP) and present Member of NITI Aayog with a view to examine the methodological issues in fixing MSP has submitted its Report. One of the Terms of Reference (ToR) of the Committee was to examine the cost concepts for the purpose of fixing Minimum Support Prices and suggest various factors for improvement  so  as  to  make  it  more  realistic.  The  Report  has  been  examined  and  a  number  of meetings have already been held with the various Ministries and Departments concerned on the recommendations.  Government  has  not  taken  any  decision on the implementation of the recommendation of the Committee so far.

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