He sought a bonus of Rs 100 per quintal as incentive to compensate the farmers to manage crop residue scientifically.
The chief minister has written to Modi, seeking compensation for the farmers for crop resident management to check the dangerous trend of stubble burning, which has triggered a major smog crisis in the northern belt of the country, an official release.
He also urged Modi to convene a meeting of chief ministers of the affected states along with the Union ministers for agriculture, food and environment on the issue.
Singh's statement came a day after Delhi Chief Minister Arvind Kejriwal sought a meeting with him and Haryana Cief Minister M L Khattar to discuss ways to tackle air pollution levels in the national capital.
The Punjab chief minister said that most of north India, including Delhi, is currently in the throes of a pollution crisis, induced largely by burning of straw in the paddy- growing areas of Punjab, Haryana and Uttar Pradesh.
"However, what is probably not being understood in proper perspective is that a problem which is essentially scientific and economic cannot be tackled through other means, including coercion," Singh said.
Scientific management and disposal of paddy straw entails significant cost for the farmer and he naturally prefers the cheaper and easy solution of burning the crop residue, he said, adding that there are at present no technical or biological systems for managing this farm operation that are economically attractive to the farmer.
He called upon the prime minister to get the matter examined on a priority basis and announce a compensation of cost management of crop residue at the rate of Rs 100 per quintal on wheat (above the minimum support price), and later for paddy to incentivise farmers not to burn their crop residue.
This could be released by way of Direct Benefit Transfer to farmers after due verification, he said, expressing the hope that the prime minister would accede to this "reasonable and practicable" suggestion, given the large economic and environmental benefits that will accrue to the nation from this positive policy intervention.
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