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Govt committed to honouring notified MSPs: Agriculture minister Radha Mohan Singh

Minister Radha Mohan Singh says the Niti Aayog and the ministry of agriculture will be working on various procurement interventions.

india Updated: Feb 18, 2018 17:53 IST
Hindustan Times
Hindustan Times
New Delhi
Radha Mohan Singh,Agriculture minister,MSP
Union agriculture minister Radha Mohan Singh speaks in the Lok Sabha in New Delhi in the winter session of Parliament. (PTI/TV Grab)

The Modi government has announced a series of steps to alleviate farm distress, promising profitable prices for farmers after a wave of protests in many states. The agrarian crisis could affect the electoral prospects of the BJP in several states where it is in power, despite farm loan waivers. In an interview with Zia Haq, agriculture minister Radha Mohan Singh listed the government’s plan to address the issue. Excerpts:

Farmers have demanded a comprehensive measure of costs called ‘C2’ to calculate 50% profits promised in the Budget. What measure of costs will the government settle on?

The government will set MSP at 1.5 times the cost of production, so that there is minimum of 50% profit over cost of production based on the prevailing method used by the Commission on Agricultural Costs and Prices. By this, all the paid out costs of the farmers, both in cash and kind will come to be taken into account.

Further, imputed value of the family labour will also be accounted for. The CACP is free to recommend profit margin even beyond the threshold level of 50%, as it deems appropriate. With a minimum of 50%, all notified crops will stand to benefit. In particular, millets and oilseeds will benefit, bringing advantage to rain-fed farmers. The National Farmers’ Commission too had suggested 50% margin on the cost of cultivation.

Unless there’s actual procurement or buying of produce by the government, MSPs are at best notional.

The government is committed to honouring the notified MSPs. In the earlier years, governments have only notified the MSPs, without providing for a back up procurement except in a few cases like wheat and paddy. Our government has been focusing on procurement of multiple crops such as pulses, oilseeds and cotton as seen in the last 2-3 years. It is worth mentioning that procurement of pulses, oilseeds and cotton during years 2014-18 has registered an increase of 285% in quantity which is worth 417% times more in terms of value as against 2011-14.

The budget has promised a mechanism soon to ensure farmers will be compensated for market losses. What mechanism are you zeroing in on?

The Niti Aayog and the ministry of agriculture will be working on various procurement interventions. There are two, three models being studied. Essentially the broad policy will be, that if prices fall below MSP, then there will definitely be government intervention to ensure that farmers are compensated adequately in accordance with the notified MSP.

Various alternatives, including that adopted by Madhya Pradesh will be examined for this purpose. Niti Aayog and ministry of agriculture are jointly holding a meeting in March first week with all the states to discuss alternatives. I have already written to all the chief ministers in this regard. We need the states to partner with us in this initiative to support the farmers, in monetizing their produce suitably.

However, our primary aim is to create an efficient market structure in the country, such that farmers get remunerative prices which are above MSP. MSP based procurement should be seen as a fall back mechanism, whereby, the farmers are sure of getting at least MSP for their produce, particularly when markets fail.

MSPs are announced for only 23 crops. Farmers grow many crops for which MSPs aren’t even fixed. For example, vegetables. What about them?

In case of crops for which MSPs are not notified and if such produce forms more than 10% of a state’s agricultural output in the previous year and if prices in the market fall below a certain level, then Government shall intervene through ‘Market Intervention Scheme’ (MIS). Our Government has by amending the Guidelines raised the limit of procurement to 20% of the state’s annual estimated production from the earlier limit of 10%.

Also read: Policy on agricultural markets to be framed after taking states’ views, says minister

First Published: Feb 18, 2018 08:38 IST

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