Lok Sabha Question No. 537 (UNSTARRED), answered on 2024-02-06
Subject: Framing of MSP Policy
Ministry: AGRICULTURE AND FARMERS WELFARE
Asked by: Pritam Gopinath Munde, Chandra Sekhar Sahu, Rahul Ramesh Shewale

## GOVERNMENT OF INDIA MINISTRY OF AGRICULTURE & FARMERS WELFARE DEPARTMENT OF AGRICULTURE & FARMERS WELFARE

## LOK SABHA UNSTARRED QUESTION NO. 537

TO BE ANSWERED ON THE 6 th  FEBRUARY, 2024

## FRAMING OF MSP POLICY

## 537.     DR. PRITAM GOPINATHRAO MUNDE: SHRI CHANDRA SEKHAR SAHU: SHRI RAHUL RAMESH SHEWALE:

Will  the  Minister of AGRICULTURE AND FARMERS WELFARE क ृ िष एवं  िकसान कʞाण मंũी be pleased to state: (a) whether Minimum Support Prices (MSP) can influence farmers' decision on choice of crops and if so, the response of the Union Government thereon; (b) whether a high MSP for some crops and not for others is hindering crop diversification and benefitting a select few States and if so, the details thereof; (c)  whether  the  MSP  for  oilseeds  has  not  delivered  the  desired  result  in  terms  of  an increase in domestic production and the country is still dependent on imports to fulfil 55% of its requirements and if so,the details thereof along with the reasons therefor; (d)  whether  there  is  a  need  to  frame  long  term  MSP  policy,  preferably  for  the  next  five years so that farmers know what they will get in the future for their crops and accordingly take an informed decision;and

- (e) if so, the steps taken by the Union Government in this regard?

## ANSWER

THE MINISTER OF AGRICULTURE AND FARMERS WELFARE क ृ िष एवं िकसान कʞाण मंũी ( SHRI ARJUN MUNDA)

- (a) to (c): Government fixes Minimum Support Prices (MSP) for 22 mandated agricultural crops, on the basis of the recommendations of the Commission for Agricultural Costs and Prices (CACP), after considering the views of State Governments and Central Ministries/Departments concerned.  The objective of MSP is to ensure remunerative prices to  the  growers  for  their  produce  with  a  view  to  encouraging  higher  investment  and production.

In recent years, the government has been increasing the MSP of oilseeds by a higher absolute amount  compared  to  the  previous years, with the view to promoting diversification towards such crops. Beside Price Policy, a Centrally Sponsored Scheme i.e.,  National  Food  Security  Mission-  Oilseeds  &  Oil  palm  (NFSM-OS&OP),  is  being implemented through the Department of Agriculture/Horticulture in 29 States/UTs in the country to  augment the availability  of  vegetable  oils  by  increasing  the  production  and productivity  of  oilseeds.  Consequently,  the  production  of  oilseeds  has  increased  from 275.11 lakh tonnes in 2014-15 to 413.55 lakh tonnes in 2022-23, registering a growth of 50 percent. Moreover, the procurement of oilseeds has increased from 0.04 lakh metric tonnes in  2014-15 to 11.71  lakh metric tonnes in 2022-23, benefiting  almost 4.8 lakh farmers. During the same period, expenditure on oilseed procurement (at MSP values) increased from 15 crores to 6.6 thousand crores.

(d) & (e): Each year, MSP is announced by the Government before the sowing of the crops,  considering  important  factors  like  prevailing  overall  demand-supply  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.  At present, there is no proposal for the next five years, before the Ministry of Agriculture and Farmers Welfare to frame a long term MSP policy.

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