Swaminathan: MSP still below recommendation

Swaminathan: MSP still below recommendation

CHENNAI: After the central government announced the new MSP of 14 kharif crops for the 2018-19 season, agriculture scientist M S Swaminathan said the MSP announced was higher in absolute terms but below the recommended level.

While he welcomed the new MSP regime, he said the government should follow it up with better procurement and storage policies. “The government has taken steps to improve crop insurance, but the coverage and performance are still far from satisfactory and risks are still high leading to demand for higher price and credit reform,” he said in a statement on Wednesday.

“For example, the MSP of common paddy has been hiked from Rs 1,550 to Rs 1,750 per quintal. Taking the C2 cost of 2017 and assuming a 3.6% rise in input costs based on the input cost index used by CACP, the estimated C2 cost for 2018-19 is Rs 1,524. So, the new MSP is C2+15%, not C2+50%. In the case of ragi, the new MSP is C2+20%. Similarly, for moong, the MSP has been raised from Rs 5,575 to Rs 6,975, so it is now C2+19%.”

Swaminathan said the policy should have three integrated components, such as an MSP-based on the formula of C2 + 50%, increasing consumption through the effective implementation of the Food Security Act, school noon meal programmes and a favourable procurement policy to ensure that farmers do receive the MSP promised.

According to Swaminathan, higher MSPs are welcome but there is inadequate public procurement at the MSP, except in the case of wheat and rice.

“This is clear from the experience of farmers who cultivated more pulses on the expectation of procurement but were let down by a crash in market prices.

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