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    Friday, July 6, 2018

    ECAS Politics : Farmers of Punjab 'Cheated and Unrest' after the MSP Hike

    With the General Elections around the corner, the Cabinet approved the highest absolute hike ever in Minimum Support Price (MSP) for Paddy and other Kharif crops. Minimum Support Price (MSP) is a form of market intervention by the Government of India to ensure agricultural producers against any sharp fall in farm prices. The minimum support prices are announced by the Government of India at the beginning of the sowing season for certain crops on the basis of the recommendations of the Commission for Agricultural Costs and Prices (CACP). 

    MSP is price fixed by Government of India to protect the producer - farmers - against excessive fall in price during bumper production years. The new MSP set-up has ensured that the farmers will get at least 150 percent of the production for each crop estimated by CACP, which is also the promise made by Prime Minister Narendra Modi during the General Election Campaign 2014 and the meeting held with the farmers last week. Furthermore, Home Minister Rajnath Singh added:

    No Government has given such a hike in Independent India's History 

    But the story doesn't end well in the state of Punjab. The farmers in the state of Punjab had been cheated as the union government hiked the MSP for paddy by the record for Rs 200 per quintal, of which the farmers of Punjab would get only Rs 180 per quintal. Every year, the government provides farmers with two MSPs for paddy crop - one for 'GRADE A' variety and second for 'COMMON' variety.

    This time the prices of 'COMMON' variety has been raised from Rs 1550 to Rs 1750 per quintal and 'GRADE A' variety from Rs 1590 to Rs 1770 per quintal. As per the reports of Punjab Agriculture University (PAU), Ludhiana, 90 percent 'GRADE A' variety is produced for which the raise is Rs 180, thus leading to Rs 20 cut per quintal for the farmers of Punjab.

    The government of India should stop claiming that it has fulfilled the promise of giving 1.5 times MSP of the production cost. According to Swaminathan committee report based on the research parameters of Punjab Agriculture University(PAU), Ludhiana states:

    The calculated MSP for 'GRADE A' variety comes to Rs 2420 per quintal and Rs 2200 per quintal for 'COMMON' variety including total input cost, labour cost, family labour cost, the rent of the land

    This MSP hike is wrong to be connected with 1.5 times higher price of the crop yield due to the hike in prices of petrol and diesel, harvesting and transportation cost which also needs to be counted for which the government has been found insensitive towards the farmers in order to help the corporates and the industrialists.
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