Letter to BS: Govt approves proposal to hike MSP by 50% for 14 kharif crops

After remaining more than four years in power, the Modi government  has announced a 50 per cent hike in minimum support prices (MSPs) for 14 kharif crops. The BJP’s 2014 election manifesto promised the farmers that its government would take steps to enhance the profitability in agriculture, by ensuring a minimum of 50 per cent profit over and above the cost of production.

The announcement shows it is not the price computed at 50 per cent above comprehensive cost (C2) being demanded by farmers’ organisation. If the MSP had been announced on C2 basis, then the price of paddy would have risen by at least Rs 700 per quintal, but the government has increased it by Rs 200 per quintal only. The government has failed to live up to its promise of fixing the MSP at 50 per cent above the cost of production, as recommended by Dr Swaminathan.

The Union government made the announcement when the sowing of kharif crops has already begun with the onset of monsoon. Had the government been sincere, the MSP would have been announced well before the start of the sowing season so that farmers can choose the crop they want to sow.

The result of this announcement will be experienced only when the farmers take their products to the markets as other than paddy and wheat, the government has not yet developed a foolproof mechanism to make purchases of various other crops. Further, the MSP alone is not sufficient to benefit farmers as 90 per cent of the farmers are unable to sale their crops at the assured price because of the lack of a procurement mechanism. 

The political motive behind the announcement is clear.

S K Khosla Chandigarh

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