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Monthly                                                                                            Vol. 9  Issue 3           July 2018     ` 50/-

          Govt. Approved MSp Hike  MSP hike ‘below the

          for kHArif CropS drAwS                                                 recoMMended level’
          Mixed reACtionS froM                                                   – MS Swaminathan, Noted Agricultural Scientist

          induStry profeSSionAlS                                                                            The report submitted   2017-18 and assuming a 3.6

          How MSP hike will impact Indian Economy is the only matter of concern                          by the Commission in    per cent rise in input costs
                                                                                                         2006, had, among various
                                                                                                                                 based on the CACP index, the
          – Bureau Report                                                                                recommendations, called   estimated C2 cost for 2018-19
                                                         for moong and 3.7% for urad.                    for giving farmers an   is Rs. 1,524. So the new MSP is
                                                         Among oilseeds, soyabean                        MSP of cost+50 per cent   actually only C2+15 per cent
                                                         grown extensively in Madhya                     with cost calculated on C2   for paddy.
                                                         Pradesh is up by 11.5%, niger                   basis, as categorised by the   Similarly, for ragi it
                                                         seed planted in Odisha is                       Commission for Agricultural   is C2+20 per cent and for
                                                         up by 45% while groundnut                       Costs and Prices.       moong, for which the MSP
                                                         raised nearly by 10%.                              C2 essentially includes the   has been raised to Rs. 6,975
                                                            The support price of                         imputed cost of capital and   from Rs. 5,575, earlier, it is
                                                         common variety paddy has                        rent for land cultivated.  C2+19 per cent, he said in the
                                                         gone up by Rs. 200/quintal to                      Swaminathan said     statement.
                                                         Rs. 1750/ quintal as compared                   in a statement that the
                                                         to last season. The highest   he Cabinet announcement   higher support prices are a   Procurement efficiency
                                                         hike in MSP is for Ragi, whose   Thiking Minimum Support   recognition of the economic   He said in terms of
                                                         floor price has gone up to   Prices for crops is “a welcome   problems of farmers. The   marketing, in addition to the
                opeful to win the   had been made on A2 + FL   Rs. 2,897/quintal, from   first step” in tackling the   “MSP announced is higher in   support price, a favourable
                support of farmers   (Family Labour), not on   Rs. 1900/quintal -- 52.47%   agrarian crisis but falls short   absolute terms but below the   procurement policy that
          Hagainst the backdrop   comprehensive cost (C2) as   increase. The MSP of   of the recommended C2+50   recommended level.”  ensures farmers get the MSP
          of agrarian distress that   demanded by many farmers’   Soyabean is Rs. 3399/quintal;   per cent, according to MS   For example, the MSP of   and measures to increase
          triggered widespread   organizations.          groundnut is Rs. 4890/  Swaminathan who headed   common variety of paddy   consumption through
          farmer protests, the Union   The cost yardstick used   quintal; and sunflower seed is   the National Commission on   has been hiked to Rs. 1,750   effective implementation of
          government has announced   to compute the MSP includes   Rs. 5388/quintal -- an increase   Farmers constituted to tackle   a quintal from Rs. 1,550 last   the Food Security Act, and
          substantially higher Minimum   all paid-out costs, such as   ...Continued on P4  the agrarian crisis.  year. Taking the C2 cost of   ...Continued on P5
          Support Prices (MSPs) for   expenses incurred on seeds,
          Kharif crops. The hike in   fertilizers, manures, irrigation
          support prices for crops, the   charges, depreciation on
          sowing for which is under   implements, hired human
          way,  is in keeping with the   labour and rent paid for
          promise made in this year’s   leased land, besides imputed
          budget speech that the prices   value of family labour.
          would be 50% higher than the   “Farmers were not getting
          cost of production.    adequate returns and were
            The Cabinet Committee   dissatisfied. Our Prime
          on Economic Affairs    Minister understood this and
          approved an average of 4-52%   took this historic decision,”
          increase in MSPs for 2018-19   said Rajnath Singh, adding
          season vis-à-vis the prices of   that the sharp increase in
          last season. Prime Minister   MSP was done after a lot of
          Narendra Modi described   consideration and “not in a
          the hike as “historic”. The   hurry”.
          “historic” Rs. 15,000-crore   The minister also stated
          hike would be determined on   that the Cabinet Committee
          the principle that the harvest   on Economic Affairs (CCEA)
          should get the farmers 150%   has approved the proposal
          of the cost of planting and   to pay farmers the price
          tending to the crop.   difference between the MSP
            Arun Jaitley, who    and the market price in the
          promised higher MSP in   event if procurement agencies
          his budget speech, said the   fail to procure crops. “This
          provisioning already made for   will translate into Rs. 6000-
          food subsidy was adequate   8000 per acre gain for the
          to take up the cost without   farmers,” he said, adding
          violating fiscal deficit target.  that the decision would
                                 have a positive impact on
          Promise Kept           the economy with the help
            Affirming that the Centre   of the purchasing power of
          has kept its promise, Union   the people in the rural areas
          Minister for Home Affairs   getting a significant boost.
          Rajnath Singh, estimated the
          additional burden on the   Support Prices
          exchequer because of this   The government raised
          decision. The report had,   the price of paddy by 13%,
          various recommendations   jowar 42%, bajra 37%, ragi
          called for giving farmers   52%, and maize 19%. Pulses,
          MSP of cost + 50%, with   which saw a substantial
          cost calculated on C2 basis.   increase formerly and now
          He, however, clarified that   adequately stocked, saw an
          the calculation of the costs   increase of 4% for arhar, 25%
       Inside Stories

             Will New Minimum Support Price (MSP)
             impact Trade, Investment & Politics of India?
             – Vijay Sardana, International Agribusiness & Trade Law Expert
             Time to shift focus from land to water
             productivity in farming, says NABARD
             MSP hike may weigh on RBI’s inflation
             forecast, push up rates
             GM crop area at 190 million hectares
             worldwide in 2017, says ISAAA report
             ICRISAT develops biofortified sorghum
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