MSP hike doesn’t signal agri reform – The Economic Times

Clipped from: https://economictimes.indiatimes.com/opinion/et-editorial/msp-hike-doesnt-signal-agri-reform/articleshow/83440862.cmsSynopsis

paddy, coarse cereals, maize, cotton and assorted pulses. Paddy prices are up by ₹53 per quintal, to ensure that farmers get 50% over and above the estimated all-India weighted average cost of cultivation.

The government has raised the minimum support prices (MSP) of 17 kharif crops: paddy, coarse cereals, maize, cotton and assorted pulses. Paddy prices are up by ₹53 per quintal, to ensure that farmers get 50% over and above the estimated all-India weighted average cost of cultivation. Two varieties of coarse grain and two kinds of pulses have been given a higher rate of return over the cost of production, in an attempt at crop diversification. Considering that the government has, in its stocks, over 100 million tonnes of wheat and rice, even after months of supplying some free food to 80 crore people, in light of economic reverses created by the pandemic, the need was to slash or, at the least, freeze the MSP for rice. The country no longer needs to produce more cereals.

But such economic sense conflicts with the compulsions of politics, with farmers already agitating against attempts at rationalisation of the procurement policy. The attempt at crop diversification moves in the right direction. But crop diversification will not be achieved solely by announcing higher support prices. Support prices are meaningless without active procurement at the support price. While the government announces support prices for around two dozen crops, active procurement is limited to a handful of crops. Even for paddy and wheat, procurement is concentrated in some regions, with Bihar and West Bengal practically outside the ambit of official procurement. Nor is procurement on the basis of a higher support price sufficient to achieve crop diversification.

There must be sustained research in crop development, field-level extension to deliver technical advice and education on agronomic prospects to farmers, choice and encouragement of farmers to take the lead.

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