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Link Whole Sale Price Index to Increase Crop MSPs | Soma Marla

Saturday 22 June 2024, by Soma S. Marla


Union Cabinet in it’s first meeting of NDA 3.0 has announced new support (MSP) for 14 crops. The hike is very minimal and ranged between 5 to 7 percentage (except for Niger and Ragi) and does not reflect the increased cost of cultivation. Severe losses suffered by BJP in recent fortunes in northern rural heartland indicate that the ruling party is fast loosing ground among farming community due to its anti famer policies.

For example, the MSP of paddy, the main kharif crop, has been raised by ₹117 from Rs 2,183 in 2023 to Rs o ₹2,300 per quintal in 2024. The hike is just 5.3%. Another crop Redgram is being sold at Rs 240 per kilo in retail Kirana shops the as per new MSPs farmers get only Rs 75 per kilogram ( mere 7.3 % rise). Only solace is oil seed crop Niger and millet Ragi (increase of 12.7 % and 11.5 % respectively.

Table: Crop MSPs Hiked

Crop New MSP, Rs % Increase over 2023
Paddy 2,300 5.3
Redgram 7,550 7.5
Cotton 7,121 7.5
Groundnut 6,783 6.4
Ragi 4,290 11.5
Niger 8,717 12.7

Though the government boasts of increase of MSPs for pulses and oil seeds so as to promote self reliance in these crops, in reality the supported price is very minimal except Niger. The new MSPs do not meet even cultivation costs. We imported in 2023 nearly 14 % of our consumption ie. 46.5 lakh tons of pulses compared to 2.53 million tons in 2022-23. We paid nearly $ 3.74 billions ( $ 1.94 bln in 2022). In oil seeds too we are having a shortage of 28 percent in consumption. Government has imported 120 lakh tons of Oil palm, sunflower and other oils from foreign countries by paying $ 18.0 billions. Due to ongoing war in Ukraine and Russia the bill is going to be $ 20.0 billions during this year. Instead of spending huge expenditure on imports our government can pay just half the amount to our farmers by giving right crop support prices as recommended by M.S.Swaminathan committee recommendations. As most of the pulses, oilseeds are cultivated by poor small farmers in rain fed conditions price increase will relieve them from prevailing rural distress.

Farmers Fury in Recent Elecions

Recent Loksabha election results clearly reflect BJP has lost much of it’s ground in UP, Punjab, Haryana and Rajastan due to farmers discontent over later’s antfarm policies. Farmers protests starting from Farmers March to Parliament, Nashik to Mumbai Padayatra and the united farmers agitation against three farm laws mirror the existing rural distress. Despite the ground realty BJP tried to evade farmers demands ( especially legal guarantee for crop MSPs and others) in recent polls. Recent post poll survey by CSDS Lokniti (June, 22, 2024) reveals that over 61% of farmers voted for Congress led INDIA alliance, while only 35 % farers voted for BJP.

Increased cultivation costs

Government’s claim that they are paying extra 50 % cost of production is white lie. Cost of inputs such as DAP, diesel, cotton seeds, transport charges have risen three times between 2014-24. However, agricultural ministry’s CPCA takes in to account 2011-12 as base year for cost of cultivation for calculation of MSPs. Instead, the government should consider last year’s input costs as basis for calculation of current season MSPs.

Besides, family labour component included is highly flawed. Tenant and small farmers belw 2.4 acres constitute 84 % of farmers. Their families toil in fields , making upto 30 % of cultivation expenses. But government considers only Rs 125 per quintal as paid out cost. In reality the family labour component amounts to nearly Rs 700 per quintal of paddy production during crop season

  • New MSPs should be computed scientifically ( C2 +50) taking previous season cost of cultivation as basis
  • Hike in CROP MSPs should be linked to WPI (Whole Sale Price Index)
  • Remove GST on inputs such as Fertilizers, pesticides and seeds.
  • Bring a law for guarantee payment of announced MSPs in markets.
  • Its time present NDA 3.0 government read the writing on the wall and start addressing farmer issue to bring relief to distressed farming community.

(Author: Dr. Soma Marla, Scientist & Head (retd), Crop Genomics, NBPGR ICAR, New Delhi. Web:

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