Govt defers decision on wheat MSP hike; okays other rabi crops

"The CCEA in its meeting today approved the MSP for rabi crops to be marketed in 2013-14 (April-March) as recommended by CACP except in case of wheat for which there would be further consultation," according to an official release.

"There will be a fresh cabinet note on wheat," a Cabinet minister had earlier said after the meeting of the Cabinet Committee on Economic Affairs (CCEA).

The MSP of gram has been hiked to Rs 3,000 per quintal for 2013-14 from Rs 2,800 this year, while support price of masur has been raised by Rs 100 per quintal to Rs 2,900.

Among oilseeds, the MSP of mustard seed has been raised to Rs 3,000 per quintal from Rs 2,500 in 2012-13 and safflower MSP from Rs 2,500 to Rs 2,800 in the review period. The MSP of barley has been kept unchanged at Rs 980.

The CCEA has approved the Commission for Agriculture Costs and Prices (CACP)'s recommendation even as Agriculture Ministry had proposed higher MSP for barley, gram and masur.

According to sources, no decision on wheat MSP was taken due to differences between the Finance and Agriculture Ministries on the issue.

The Finance Ministry is of the opinion that the higher wheat MSP could lead to increase in food subsidy bill and widen the fiscal deficit. That apart, it would lead to rise in prices, sources said.

The Finance Ministry felt CACP should relook at wheat support price and the Agriculture Ministry could bring a fresh cabinet note on the issue, they added.

The CACP recommended freezing of wheat MSP at last year's level of Rs 1285 per quintal. It suggested to the government to announce 10 per cent bonus to growers in case wheat export was banned. But the Agriculture Ministry had sought wheat MSP to be fixed at Rs 1400 per quintal for 2013-14.