The Indian government, on Wednesday (June 7) approved the increase of the Minimum Support Price (MSP) for all mandated Kharif crops for the marketing season 2023-24.
The announcement was made by the Indian Minister of Food and Consumer Affairs Minister Piyush Goyal after a meeting of the Cabinet Committee on Economic Affairs (CCEA), chaired by Prime Minister Narendra Modi.
The highest increase in MSP was noted in Moong by 10.4 per cent at Rs 8,558 ($104) per quintal this year which is up from Rs 7,755 ($93.98) per quintal last year.
What is the increased MSP and why?
The Indian minister has said that the MSP of common grade variety of paddy has been increased by Rs 143 ($1.73) to Rs 2,183 ($26.5) per quintal for the 2023-24 crop year which is also risen from Rs 2,040 ($25) in the previous year. Additionally, the support price of the ‘A’ grade variety of paddy has been hiked by Rs 163 ($1.98) to Rs 2,230 ($27) per quintal from Rs 2,060 ($24.96).
“This move is to ensure remunerative prices to the growers for their produce and to encourage crop diversification,” said Goyal while addressing a press conference after the meeting.
The Indian minister also noted that the kharif crops are estimated to be 330 million tonnes this year compared to 285 million tonnes in 2018-19, which is also said to be the highest increase in the last five years.
He added, “In agriculture, we have been fixing MSP from time to time based on the recommendations of the CACP (Commission for Agricultural Costs and Prices). The increase in MSP of kharif crops for this year is highest compared to the previous years.”
The raise is also in line with the Union Budget 2018-19 announcement of fixing the MSP at least 1.5 times the All-India weighted average cost of production which was aimed at “fair remuneration for the farmers.”
The Indian government in a statement also stated, “The expected margin to farmers over their cost of production are estimated to be highest in case of bajra (82 per cent) followed by tur (58 per cent), soybean (52 per cent) and urad (51 per cent).” It added, “For (the) rest of the crops, margin to farmers over their cost of production is estimated to be at least 50 per cent.”
This also comes as the Indian government is moving to boost rice output after it banned exports of broken rice, last year, while also imposing a 20 per cent tax on exports to calm domestic prices.
Monsoon conditions in India
Notably, paddy is the main kharif crop, the sowing for which begins during the onset of the southwest monsoon. The India Meteorological Department (IMD) has projected a normal monsoon for the June-September period despite the El Nino climate pattern. However, the monsoon has missed its offset in the Indian state of Kerala.
(With inputs from agencies)
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