Understanding Minimum Support Price a demand by farmers

Hello readers,

A demand for minimum support prices by farmers for their crops is to ensure that they get a price for their hard work. Gone are those days when farmers were confident of harvesting their crops if they sowed seeds and watered them at the right time.

Today, farmers have to cross multiple barriers like extreme heat, unseasonal rainfall, pest attacks, drought, etc. A teenage boy writes on his paper during an essay competition; he also remembers how he concluded that the farmer’s battle to receive a fair price ends here, only to know he is wrong. This is due to a lack of minimum support price demand, which has remained in demand for farmers for years.

The boy sitting in a corner of the huge hall, which had approximately 800 candidates, thinks about the competition he needs to face to get first prize. Eventually, he fell into thoughts on how to appease the panellists and outsmart everyone.

As he fell into thought, his mind spoke to him

Mind: A lot of people don’t know which crops come under MSP, so start on that

Boy: “Twenty-four crops come under this; it includes cereals and crops such as sugarcane and cotton.” Writes the boy

Mind: mention all the crops covered under the Minimum Support Price

Boy: Paddy, Wheat, Jowar, Barley, Bajra, Ragi, Maize, Arhar, Gram, Lentil, Moong, Urad, Ground Nut, Mustard, Soya Bean, Toria, Sesamum, Sunflower Seed, Safflower Seed, and Niger Seed. Recalls the boy

Mind: Now write about financial cost because some people argue the government doesn’t have money

Boy: In the year 2022-2023, the cost of MSP for the above products will be 2.28 lakh crore, up from 1.06 lakh crore in 2014-2015, says the boy

Mind: So those who oppose MSP are right?

Boy: Have you gone mad, This is a one-sided story

Mind: What is the other side?

Boy: It is helpful for only rice and wheat farmers, say critics. Also, a double procurement system creates a buffer stock of grain and will lead to storage problems.

Mind: Is this the other side, I thought something positive

Boy: “The other side can have any meaning,” he replies. He then continues to say, “The farmers are demanding the minimum support price to be guaranteed by law. This is because they are expecting stability in earnings, good prices for their hard work, etc.”

Mind: say something pro-MSP

Boy: If the minimum support price is implemented, the income of farmers rises, which in turn raises consumption, and so does the increase in revenue for the government.

Mind: that means it is an Investment

Boy: yes, but

Mind: what but

Boy: If the Minimum Support Price is implemented, then the production of crops under it increases, leading to a decrease in the production of other crops. This leads to an increase in the price of rice and an increase in fiscal deficit, which is not good for the economy

Mind: So what to do now?

Boy: A balanced approach is required to solve the problem. The decision can be taken by having constructive discussions among farmers, economists, policymakers, and other eminent people about solving critical problems. Whatever it may be, it is not my problem, so I do not need to do anything now

Mind: stupid, I am asking how are you going to conclude the essay

Boy: What, I am in the essay competition hall. (His words indicate he just realized where he is and what he is supposed to do.)

He starts scribbling on the papers, looking at the time. After a few minutes, the examiner announces that everyone is to submit their paper. He walks to the respective place to submit by mumbling.

Dear Readers,

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FAQ

1. What is the Minimum Support Price?

It is an assurance given by the government, irrespective of the market situation, that they will purchase crop produce from farmers at a fixed price.

2. Does MSP hamper the country’s economy?

This question cannot be answered with “yes” or “no.”. on the one hand, it causes a financial burden on the government, which is true; on the other hand, it boosts farmers’ income and increases consumption, which in turn aids the economy.

3. How many crops are covered under the minimum support price?

Twenty-four crops are covered under MSP

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