MSP of pulses should be realistically fixed if Centre wants to double farmer's income

The Centre on Tuesday announced a hefty increase in Minimum Support Price (MSP) of all rabi crops in which wheat is keenly watched because of its vast impact in Northern India.

Government being the single biggest buyer of wheat and rice in the country, any wrong step in this could have jeopardised the lives of millions of farmers. Also, being keenly watched was the MSPs of pulses, particularly that of gram (chana) and masur (lentils).

Chana is by far the biggest pulses grown in India and millions of farmers across Central and western parts of the country are dependent on its production, mostly in arid, rainfed areas.

 

Chana production in the last two years has been dwindling due to drought in major growing regions, a reason why prices topped Rs 110 per kilogram in the last few months, though prices of other pulses slumped due to bumper harvest. 

The Centre declared MSP of Rs 4,000 per quintal or Rs 40 per kg for chana in the 2016-17 crop year, which is exactly what the Arvind Subramanian panel of pulses had suggested for the 2016 rabi crop.

However, given that prevailing market rates of chana are more than Rs 110 per kilogram and acreage till last week was already around 26 per cent more than the previous year, a mere 14 per cent rise in chana MSP is not expected to do much give a decent return to farmers and might not act as a big signal.

Going forward, there is every possibility that just like moong and arhar, acreage under chana this season could reach record highs. If that happens, prices are bound to crash and in such a scenario a MSP of Rs 40 per kilogram could be insufficient to give good income to farmers.

Same is the case with masur as well. If the Centre truly wants farmers to react to pulses MSPs and double farmers income by 2022, it should come out with realistic MSPs for pulses one which on one hand would encourage him to shift from wheat and rice while at the same time should not discourage him from growing pulses if prices crash, more so now when Centre plans to regularly purchase pulses from growers to create a 2 million tonnes buffer.