What is the Minimum Support Price (MSP)?
Minimum Support Price (MSP) is a kind of guarantee of a minimum price for the agricultural produce in India. The MSP is announced by the Government of India at the beginning of the sowing season for some crops to protect the producers i.e. farmers - against acute fall in price during bumper production years.
So the announcement of the MSP motivates the farmers to sow more crops every year.
How many crops are under Minimum Support Price (MSP)?
The minimum support price of 22 crops is declared by the the 'Department of Agriculture and Co-operation, Government of India on the recommendations of the Commission for Agricultural Costs and Prices (CACP).
The mandated crops are 6 rabi crops, 14 crops of the Kharif season, and two other commercial crops. In total it includes; Cereals (7) - wheat, paddy, bajra, barley, jowar, ragi, and maize; Pulses (5) -arhar/tur, gram, urad, moong, and lentil and Oilseeds (8);rapeseed/mustard, groundnut,soyabean, toria, sesamum, safflower seed, sunflower seed, and nigerseed.
The Minimum Support Prices for all mandated crops is increased by the Cabinet Committee on Economic Affairs (CCEA) chaired by Prime Minister Shri Narendra Modi on June 1, 2020.
Minimum Support Prices (MSPs) for all Kharif crops for 2020-21:
| Crops | MSP for Kharif 2020-21 | Increase in MSP (Absolute)
|
| Paddy (Common) | 1,868 | 53
|
| Paddy (Grade A) | 1,888 | 53
|
| Jowar (Hybrid) | 2,620 | 70
|
| Jowar (Maldandi) | 2,640 | 70
|
| Bajra | 2,150 | 150
|
| Ragi | 3,295 | 145
|
| Maize | 1,850 | 90
|
| Tur (Arhar) | 6,000 | 200
|
| Moong | 7,196 | 146
|
| Urad | 6,000 | 300
|
| Groundnut | 5,275 | 185
|
| Sunflower Seed | 5,885 | 235
|
| Soybean (yellow) | 3,880 | 170
|
| Sesamum | 6,855 | 370
|
| Nigerseed | 6,695 | 755
|
| Cotton (Medium Staple) | 5,515 | 260
|
| Cotton (Long Staple) | 5,825 | 275
|
How is Minimum Support Prices (MSPs) decided?
The Commission for Agricultural Costs and Prices (CACP) takes into account several factors while deciding the MSPs of Rabi and Kharif crops. These factors are;
1. A minimum of 50% as the margin over the cost of production
2. Demand and supply
3. Changes in input prices
4. Input-output price parity
5. Effect on the cost of living
6. Effect on the general price level
7. Trends in market prices
8. Parity between prices paid and prices received by the farmers
9. International price situation
So this was the complete information on the Minimum Support Prices (MSPs) for the Kharif crops of 2020-21 season. This article is very important for various competitive exams like IAS/PCS/SSC/CDS etc.
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