Lok Sabha Question No. 779 (UNSTARRED), answered on 2023-07-25
Subject: MSP of Kharif Crops
Ministry: AGRICULTURE AND FARMERS WELFARE
Asked by: Manickam Tagore B

## GOVERNMENT OF INDIA MINISTRY OF AGRICULTURE & FARMERS WELFARE

## DEPARTMENT OF AGRICULTURE & FARMERS WELFARE

## LOK SABHA UNSTARRED QUESTION NO. 779

TO BE ANSWERED ON THE 25 TH  JULY, 2023

## MSP OF KHARIF CROPS

## 779. SHRI MANICKAM TAGORE B:

Will the Minister of AGRICULTURE AND FARMERS WELFARE क ृ िष एवं िकसान कʞाण मंũी be pleased to state:

- (a)  whether  it  is  a  fact  that  farmers  across  the  country  were  unhappy  with  the  hiked Minimum Support Price (MSP) for Kharif 2023;
- (b)  whether  it  is  also  true  that  the  new  MSPs  were  not  linked  to  the  real  expenses  of farming;

(c) whether it is also true that the new-announced MSP for kharif crops is nowhere near the C2+50% formula proposed by the Swaminathan Commission;

(d) whether it is also true that the cost of production estimates given by the Government are faulty and underrated and thus the MSP figures are also very unsatisfactory; and

- (e) if so, whether the Government is considering making a rethink on MSP?

## ANSWER

- (a) to (e): Government has notified Minimum Support Prices (MSP) for 14 mandated Kharif Crops  for  Marketing  Season  2023-24,  on  the  basis  of  the  recommendations  of  the Commission for Agricultural Costs and Prices (CACP), views of State Governments and

THE MINISTER OF AGRICULTURE AND FARMERS WELFARE क ृ िष एवं िकसान कʞाण मंũी (SHRI NARENDRA SINGH TOMAR) Central Ministries/Departments concerned.

While recommending MSP, CACP considers important factors like overall demandsupply  conditions,  cost  of  production,  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  land,  water  and  other production resources and a minimum of 50 percent as the margin over cost of production. The  Cost  of  production  is  one  of  the  important  determinants  of  MSP  and  its estimation is based on the methodology recommended by Expert Committees from time to time.  CACP  projects  cost  for  ensuing  marketing  season  on  the  basis  of  actual  paid  out costs and imputed value of family labour and Composite Input Price Index (CIPI) which is based on latest prices of major inputs like human labour, bullock labour, machine labour, fertilisers and manures, seeds, pesticides and irrigation. recommendation, Government, in its Union Budget for 2018-19, had made

National  Commission  on  Farmers  (NCF),  constituted  under  the  Chairmanship  of Prof. M.S. Swaminathan in 2004, had, inter alia, recommended that MSP should be at least 50  percent  more  than  the  weighted  average  cost  of  production.  To  give  effect  to  this an announcement to keep MSP at a level of one and half times of the cost of production as a pre-determined  principle.  Accordingly,  MSPs  for  all  mandated  Kharif,  Rabi  and  other commercial  crops  have  been  fixed  with  a  margin  of  at  least  50  per  cent  over  all  India weighted average cost of production since the year 2018-19

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