India Hikes MSP Of Six Rabi Crops Amid Protests On Farm Bills

The Cabinet Committee of Economic Affairs has approved increasing MSP of six rabi crops.

A farmer harvests a wheat crop. (Photographer: Asad Zaidi/Bloomberg)
A farmer harvests a wheat crop. (Photographer: Asad Zaidi/Bloomberg)

India increased the minimum support prices for six rabi crops following protests by farmers and lawmakers over apprehensions that the new farm bills passed by the government would end the MSP regime.

The Cabinet Committee on Economic Affairs has increased the MSP for wheat by Rs 50 per quintal to Rs 1,975, Agriculture Minister Narendra Singh Tomar said in Parliament on Sept. 21.

  • MSP for ‘chana’ (chickpeas) hiked by Rs 225 per quintal to Rs 5,100.
  • MSP for ‘masoor’ (orange lentil) increased by Rs 300 per quintal to Rs 5,100.
  • MSP for mustard increased by Rs 225 per quintal to Rs 4,650.
  • MSP for ‘jowar’ or barley increased by Rs 75 per quintal to Rs 1,600.
  • MSP for ‘kusum’ (safflower) increased by Rs 112 per quintal to Rs 5,327.

The increase in the prices of six crops ranges between 2.1% and 6.2%, and is lower than those announced last year.

“MSP will continue, and by announcing an increase in MSP we have proved that,” Tomar said. “APMCs (Agricultural Produce Market Committees) will also continue and farmers can sell their crops anywhere in India.”

Farm Bills Need Of 21st Century, Mandis And MSP Will Stay: PM Modi

Opposition parties and farmer groups in Punjab, Haryana and some other states staged protests after Parliament passed two key farm bills on Sept. 20, which the government says will give farmers marketing freedom and better price for their produce.

Rajya Sabha Passes Two Farm Bills Amid Ruckus By Opposition

The bills—Farmers’ Produce Trade and Commerce (Promotion and Facilitation) Bill, 2020, and The Farmers (Empowerment and Protection) Agreement of Price Assurance and Farm Services Bill, 2020—also seek to provide a framework on farming agreements that protects and empower farmers to engage with agri-business, processors, wholesalers, exporters or large retailers for farm services.

The government generally hikes MSP for rabi crops in late October but following the farmers’ protests, the price hikes were announced a month in advance.

Proceedings at Rajya Sabha on Sept. 20 were adjourned after lawmakers from opposition parties staged protests. That led to suspension of eight opposition lawmakers in India’s upper house of parliament for a week for “unruly behaviour”.

The increase in MSP for marketing season 2021-22 is in line with the principle of fixing them at around 1.5 times the all-India weighted average cost of production as announced in Union Budget 2018-19, the government said in a statement. Expected returns to farmers over their cost of production are estimated to be highest in case of wheat at 106%, followed by mustard at 93%, gram and lentil at 78%. For barley, return to farmers over their cost of production is estimated at 65% and 50% for safflower, the statement said.

The statement also said that the government has made a record procurement of wheat at about 39 million tonnes for the rabi marketing season 2020-21 despite the Covid-19 pandemic and consequent lockdown.