Lok Sabha Question No. 3664 (UNSTARRED), answered on 2019-12-10
Subject: Increase in MSP of Rabi Crops
Ministry: AGRICULTURE AND FARMERS WELFARE
Asked by: Sajda Ahmed, Ajay (Teni) Misra, Khagen Murmu, Virendra  Kumar

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

## LOK  SABHA UNSTARRED QUESTION NO.3664

TO BE ANSWERED ON THE  10 TH  DECEMBER, 2019

## INCREASE IN MSP OF RABI CROPS

3664.  SHRIMATI SAJDA AHMED:

SHRI AJAY KUMAR MISRA TENI:

SHRI KHAGEN MURMU:

DR. VIRENDRA KUMAR:

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

- (a) whether  the  Government  has  recently  increased  or  is  considering  to  increase  the Minimum Support Price for Rabi crops for the year 2019 or during the marketing/procurement season 2020-2021;
- (b) if  so,  the  crop-wise  details  of  the  increase  in  the  Minimum  Support  Price  and  the extent of the benefits likely to be received by the farmers and if not, the reasons therefor;
- (c) the  proportion  of  the  purchase  of  the  Rabi  Crops  by  the  Government  and  the production by farmers during the last year across the country;
- (d) whether the Government has conducted any effective study for assessing the impact of Minimum Support Price on paddy farming; and
- (e) whether it is true that benefit of MSP is not available to 10 per cent of Indian farmers, if so,  the  policy  adopted  by  the  Government  to  ensure  the  direct  benefit  of  the  MSP  to  the farmers?

## ANSWER

MINISTER OF AGRICULTURE AND FARMERS WELFARE

कृ ष एवं कसान कयाण मंी ( SHRI NARENDRA SINGH TOMAR)

- (a) & (b): Union Government has announced the Minimum Support Price (MSP) for six rabi crops viz. wheat, barley, gram, lentil, rapeseed & mustard and safflower on 23 rd October, 2019. MSP is announced for rabi crops of year 2019-20, to be marketed in Rabi Marketing Season 2020-21.

The Union Budget for 2018-19 had announced the pre-determined principle to keep MSP at  levels  of  one  and  half  times  of  cost  of  production.  Accordingly,  Government  has increased the MSPs for all mandated Kharif, Rabi and other commercial crops with a return of  atleast  50  per  cent  of  cost  of  production  for  the  agricultural  year  2018-19.  The  recent increase  in  MSP of  rabi  crops  of  year  2019-20  to  be  marketed  in  Rabi  Marketing  Season 2020-21 is also in accordance to the principle of providing atleast 50% return over cost of production. The details of increase in MSP and crop-wise return over cost of production for rabi crops are given in Annexure I .

(c): Food Corporation of India and other designated state agencies provide price support to  the  farmers  in  the  case  of  cereals,  while  State  Governments  undertake  procurement  of coarse grains with the prior approval of Government  of  India.  The  Government  is implementing  Price  Support  Scheme  (PSS)  for  procurement  of  pulses  &  oilseeds  at  MSP under  the  umbrella  Scheme  'Pradhan  Mantri  Annadata  Aay  SanraksHan  Abhiyan  (PMAASHA).  The details regarding procurement of rabi crops and production of rabi crops of year 2018-19 (Rabi Marketing Season 2019-20) is given in Annexure II .

(d): No, Sir. Ministry of Agriculture & Farmers Welfare has not conducted any study in this regard.  However,  NITI  Aayog  has  conducted  an  evaluation  study  on  efficacy  of  Minimum Support Prices (MSP) on Farmers in January, 2016.

(e): Government's price policy is to ensure remunerative prices to farmers by offering to procure  their  produce  at  minimum  support  price  (MSP).  However,  farmers  are  free  to  sell their  produce  to  the  Government  procurement  agencies  at  MSP  or  in  the  open  market whichever is advantageous to them.

Apart from increasing MSP,  Government  has  taken  several  steps  to  provide remunerative  prices  to  farmers  for  their  produce  which  include  undertaking  procurement through  designated  procurement  agencies,  implementing  e-National  Agriculture  Market  (eNAM),  enacting  the  Model  Agricultural  Produce  and  Livestock  Marketing  (Promotion  & Facilitation) Act, 2017 and promoting Farmer Producer Organizations (FPOs).

The Government is working on market architecture so as to ensure that farmers get remunerative  prices  on  their  produce.  These  include  setting  up  of  Gramin  Agricultural Markets (GrAMs) with a view to promote 22,000 number of retail markets in close proximity of farm gate; competitive and transparent wholesale trade at APMC through e-NAM.

The recently launched Umbrella Scheme 'Pradhan Mantri Annadata Aay SanraksHan Abhiyan (PM-AASHA)' provides for a holistic arrangement for assurance of a remunerative price for farmers. This Umbrella Scheme comprises Price Support Scheme (PSS) for pulses, oilseeds  and  copra,  Price  Deficiency  Payment  Scheme  (PDPS)  and  Pilot  of  Private Procurement & Stockist Scheme (PPSS) for oilseeds to ensure MSP to the farmers.

MSP operations  are  given  wide  publicity  through  pamphlets,  banners,  sign  boards, radio, TV and advertisements through print & electronic media. In addition to that farmers are made aware of  the  quality  specifications  and  purchase  system  to  facilitate  the  farmers  to bring their produce conforming to the specifications.

Annexure referred to in reply to part (a) & (b) of Lok Sabha Unstarred Question No. 3664 due for reply on 10.12.2019.

## Minimum Support Prices for rabi crops

(Rs. per quintal)

|   S.No | Crops              |   Cost* of production for RMS # 2020-21 |   MSP for RMS # 2019-20 |   MSP for RMS # 2020-21 |   Absolute increase in MSP |   Return over cost ( in per cent) |
|--------|--------------------|-----------------------------------------|-------------------------|-------------------------|----------------------------|-----------------------------------|
|      1 | Wheat              |                                     923 |                    1840 |                    1925 |                         85 |                               109 |
|      2 | Barley             |                                     919 |                    1440 |                    1525 |                         85 |                                66 |
|      3 | Gram               |                                    2801 |                    4620 |                    4875 |                        255 |                                74 |
|      4 | Lentil             |                                    2727 |                    4475 |                    4800 |                        325 |                                76 |
|      5 | Rapeseed & Mustard |                                    2323 |                    4200 |                    4425 |                        225 |                                90 |
|      6 | Safflower          |                                    3470 |                    4945 |                    5215 |                        270 |                                50 |

#RMS refers to Rabi Marketing Season

Annexure II Annexure referred to in reply to part (c) of Lok Sabha Unstarred Question No. 3664 due

## for reply on 10.12.2019.

## Production and Procurement of Rabi crops of year 2018-19

('000 Tonnes)

|   S.No | Crops              |   Production* |   Procurement # |   Proportion of procurement to production(%age) |
|--------|--------------------|---------------|-----------------|-------------------------------------------------|
|      1 | Wheat              |     102190    |        34132.8  |                                            33   |
|      2 | Barley             |       1751.5  |            0    |                                             0   |
|      3 | Gram               |      10128.8  |          776.41 |                                             8   |
|      4 | Lentil             |       1561.9  |           56.24 |                                             3.6 |
|      5 | Rapeseed & Mustard |       9339    |         1088.95 |                                            12   |
|      6 | Safflower          |         23.95 |            0    |                                             0   |

* As per 4th Advance Estimates. # Rabi crops of year 2018-19 are procured in Rabi Marketing Season 2019-20.

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