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When Budget 2021 Did a Fact Check on MSP and Market Reforms, Busting Many Wrong Claims

Among the many myths that the political opposition and the so-called farmers’ leaders try to spread, two are prominent.

First, this government wants to end Minimum Support Price mechanism with farm reforms.

Second, it is destroying APMC in the name of reforms.

The Budget announcement this year seems to address both these misgivings by exhibiting that its intention is not to destroy any systems but to provide new market avenues for farmers.

On MSP, Hard Facts

Budget 2021 put out figures for the public at large to show how the government spending in MSP for major crops has increased ever since the Modi government came into power in 2014.

The Budget document clearly states the following points regarding MSP:

  • In case of wheat, the total amount paid to farmers in 2013-2014 was ₹33,874 crore. In 2019-2020 it was ₹62,802 crore, and even better, in 2020-2021, this amount, paid to farmers, was ₹75,060 crore. The number of wheat farmers that benefitted increased in 2020-21 to 43.36 lakh as compared to 35.57 lakh in 2019-20.
  • For paddy, the amount paid in 2013-14 was ₹63,928 crore. In 2019- 2020 this increased ₹1.41 lakh crore. Even better, in 2020-2021, this is further estimated to have increased to ₹1.72 lakh crore. The number of farmers who benefitted increased from 1.24 crore in 2019-20 to 1.54 crore in 2020-21.
  • In the same vein, in case of pulses, the amount paid in 2013-2014 was ₹236 crore. In 2019-20 it increased to ₹8,285 crore. Now, in 2020-2021, it has touched ₹10,530 crore, a 40 fold increase from 2013-14.
  • The receipts to cotton farmers have also seen a stupendous increase, from ₹90 crore in 2013-14 to ₹25,974 crore as on 27th January 2021.

At a time when the political opponents are busy arguing that the government intends to destroy AMPCs, Budget 2021 indicated otherwise. “The Agriculture Infrastructure Fund would be made available to APMCs for augmenting their infrastructure facilities,” Finance Minister Nirmala Sitharaman announced on the floor of the house.

At the same time, this can’t be viewed as a return to the old system. The e-NAM system in fact is being further strengthened in this budget. As the Finance Minister stated, “Around 1.68 crores farmers are registered and Rs 1.14 lakh crores of trade value has been carried out through e-NAMs. Keeping in view the transparency and competitiveness that e-NAM has brought into the agricultural market, 1,000 more mandis will be integrated with e-NAM.”


The official site that disseminates budget-related information has provided the gist of other assistances to agriculture and allied sector, for a broader outlook.