MSPs ensured minimum return of 50% over production cost in 2023-24: RBI

The minimum support prices (MSPs) for both kharif and rabi seasons 2023-24 ensured a minimum return of 50 per cent over the cost of production for all crops, said the Reserve Bank's Annual Report released on Thursday.

The overall public stock of foodgrains as on March 31, 2024 stood at 2.9 times the total quarterly buffer norm, the report said.

On November 29, 2023, the government extended the scheme of free distribution of foodgrains under the Pradhan Mantri Garib Kalyan Anna Yojana (PMGKAY) for five more years, effective from January 1, 2024.

The report, which is a statutory report of RBI's central board of directors, noted that the agriculture and allied activities faced headwinds from the uneven and deficient south-west monsoon (SWM) rainfall coinciding with strengthening El Nino conditions.

The overall SWM rainfall in 2023 (June-September) was 6 per cent below long period average (LPA) at the all-India level.

As per the second advance estimates, the production of kharif and rabi foodgrains in 2023-24 was 1.3 per cent lower than the final estimates of the previous year.

The output of millets could benefit from productivity gains, the report said.

MSPs in 2023-24 were increased in the range of 5.3-10.4 per cent for the kharif crops and 2.0-7.1 per cent for the rabi crops.

Moong witnessed the maximum MSP increase among kharif crops, while the increase was the highest for lentils (masur) and wheat among rabi crops.