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Is There Any Basis to Believe That This Government Will Wind Up MSP?

MSP Mechanism

If you ask those arguing against farm laws that why should there be a problem if the government provides marketing opportunities beyond APMCs even though the mandi system is very much intact, there comes a typical answer. “No. This will lead to winding up of Minimum Support Price and this government is heading in that direction.”

To claim that this government will end the MSP mechanism, one needs to cite some precedence with this government that compels them to fear so. On the contrary though, what one can see is BJP’s consistent effort in improving the MSP mechanism not only to the benefit of farmers but for all the stakeholders including consumers.

NDA implemented MSP fixation recommendation

Swaminathan Committee’s recommendation regarding fixation of MSP was implemented by the NDA government. Under this mechanism, at least 50% profits on cost of production is assured. The Commission submitted its reports between 2004-06; however, the party which was in power from 2008-2014 did not take any concrete action based on the recommendations. Ironically, that very party is now often seen holding placards and sloganeering against the present government for being “anti-farmer”.

Swaminathan acknowledged the steps taken by the Modi government in his article in 2018, where he wrote, “although the NCF report was submitted in 2006 very little action was taken until the present government headed by Prime Minister Narendra Modi took office. Fortunately, over the last four years, several significant decisions have been taken to improve the status and income of farmers.”

Procurement Through MSP Strengthened During NDA: Both in terms of procurement centres and number of farmers benefitting from MSP, an upward trend is evident.

Number of procurement centers for Wheat in Rabi season went up to 21,869 during 2020-21, thus registering an increase of almost 50% on previous year’s 14,838 procurement centers.

Procurement centers planned for Kharif season during 2020-21 increased from 30,549 (2019-20) to 39,130 — nearly 30% increase in procurement centers.

Number of procurement centers (Rabi & Kharif seasons combined) went up from 48,550 in 2016-17 to 64,515 in 2019-20, thus registering an increase of nearly 33% over just 4 years.

Number of farmers who benefited from paddy procurement at MSP has increased by 72% between 2017-18 to 2019-20.

Focussing Beyond Rice and Wheat: It is not that the pulses and cereals didn’t have MSP before NDA, but this government has focussed on this front prominently to make India self-sufficient in pulses.

Finance Minister Nirmala Sitharaman explained this aspect in one of her interviews when she said, “MSP has been operational in this country for decades. The list of items has increased to about 23. However, during the Congress rule, the emphasis has always been on rice and wheat, resulting in distortion in acreage under these two crops at the cost of coarse grain, pulses, and oil seeds. The production of pulses, at least till 2014, was far less than what India needed, leading to a situation of net imports. Also, after crude oil and gold, edible oil is a significant import. Between 2014 and 2016, the PM gave attention to ensuring India became self-sufficient in pulses. We were able to give MSP and bonus for pulse growers.”

This assertion is also reflected in opinions discussing the agriculture sector.