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LATEST NEWS UPDATES | 16-53% increase in kharif MSP by govt may stoke food inflation </title>
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-The Economic Times
The government has increased the minimum support price (MSP) for the kharif season in a range of 16% to 53% to motivate farmers and compensate for higher input costs but the higher purchase prices could stoke food inflation..."/>
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The government has increased the minimum support price (MSP) for the kharif season in a range of 16% to 53% to motivate farmers and compensate for higher input costs but the higher purchase prices could stoke food inflation..." />
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<h1 class="cat-box-title">16-53% increase in kharif MSP by govt may stoke food inflation</h1>
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Published on</span><span class="text-date"> Jun 15, 2012</span>
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<div style="text-align: justify">-The Economic Times</div><div style="text-align: justify"><img src="https://im4change.in/siteadmin/tinymce/uploaded/MSP.jpg" alt="MSP" width="280" height="592" /></div><div style="text-align: justify">The government has increased the minimum support price (MSP) for the kharif season in a range of 16% to 53% to motivate farmers and compensate for higher input costs but the higher purchase prices could stoke food inflation further. </div><div style="text-align: justify"><br /></div><div style="text-align: justify">The Committee on Economic Affairs ( CCEA) on Thursday raised the MSP of paddy by Rs 170 per quintal and those of oilseeds like groundnut, sunflower seed and niger seed in a range of Rs 600 to 1,000 per quintal. </div><div style="text-align: justify"><br /></div><div style="text-align: justify">The floor price of urad has also been increased by Rs 1,000 per quintal to Rs 4,300 per quintal while the decision on MSPs of key pulses - tur and moong, was deferred. The Commission for Agriculture Prices and Costs (CACP), which recommends MSP for crops every year, has suggested a 28.6% increase for moong and 25% increase on tur pulses. </div><div style="text-align: justify"><br /></div><div style="text-align: justify">The MSP of coarse grains like jowar has seen the biggest jump of 53% to Rs 1,500 per quintal while the floor prices of cotton varieties have been raised by Rs 600 to Rs 800 per quintal. </div><div style="text-align: justify"><br /></div><div style="text-align: justify">The increase in the MSP for paddy from Rs 1,080 per quintal to Rs 1,250 per quintal (common variety) and from Rs 1,110 to Rs 1,270 for 'A' grade variety is expected to increase the acreage under paddy this summer in key states including West Bengal and Andhra Pradesh. At the same time, it is likely to increase the food subsidy bill, which is already hovering around Rs 75,000 crore. </div><div style="text-align: justify"><br /></div><div style="text-align: justify">"The under-provisioning of food subsidy in the current year is at Rs 31,750 crore. Now with increased MSP on paddy, the total food subsidy deficit at the end of the current year will be about Rs 40,000 crore putting immense pressure on the food subsidy burden of the government," said a food ministry official. </div><div style="text-align: justify"><br /></div><div style="text-align: justify">The higher MSP for other crops, especially oilseeds and pulses, will not have direct impact on food subsidy burden but will definitely fuel inflation. </div><div style="text-align: justify"><br /></div><div style="text-align: justify">"Food inflation is already high. An increase in the floor prices of oilseeds and pulses will burn holes in the pockets of consumers. The focus of the government should be to increase the profitability of farmers but not through increasing prices but through improving productivity," said PK Joshi, director, South Asia, International Food Policy Research Institute. </div><div style="text-align: justify"><br /></div><div style="text-align: justify">However, CACP chairman Ashok Gulati argues that this will not impact inflation. </div><div style="text-align: justify"><br /></div><div style="text-align: justify">"The market prices of most of the commodities are already more than the new MSPs. This is not going to push inflation up. In 2011-12, we had imported edible oil and pulses worth more than Rs 50,000 crore. To encourage farmers to plant more oilseeds and pulses, we have recommended to raise MSP, taking their prices closer to the import parity prices," he said. </div><div style="text-align: justify"><br /></div><div style="text-align: justify">Gulati has an advice for reining the food subsidy bill despite the increase in paddy MSP. </div><div style="text-align: justify"><br /></div><div style="text-align: justify">"The government should increase the central issue price - the price at which government sells food grains through ration shops - of rice in sync with the hike in floor prices. The CIP has remained unchanged since 2002 and it should be revised to rein in increasing subsidy," he said.</div><div style="text-align: justify"><br /></div>
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<br><a href="http://economictimes.indiatimes.com/news/economy/indicators/16-53-increase-in-kharif-msp-by-govt-may-stoke-food-inflation/articleshow/14137154.cms" class="re" target="_blank">The Economic Times, 15 June, 2012, http://economictimes.indiatimes.com/news/economy/indicators/16-53-increase-in-kharif-msp-by-govt-may-stoke-food-inflation/articleshow/14137154.cms</a><div class="clear"></div>
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LATEST NEWS UPDATES | 16-53% increase in kharif MSP by govt may stoke food inflation </title>
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The government has increased the minimum support price (MSP) for the kharif season in a range of 16% to 53% to motivate farmers and compensate for higher input costs but the higher purchase prices could stoke food inflation..."/>
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<h1 class="cat-box-title">16-53% increase in kharif MSP by govt may stoke food inflation</h1>
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Published on</span><span class="text-date"> Jun 15, 2012</span>
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<div style="text-align: justify">-The Economic Times</div><div style="text-align: justify"><img src="https://im4change.in/siteadmin/tinymce/uploaded/MSP.jpg" alt="MSP" width="280" height="592" /></div><div style="text-align: justify">The government has increased the minimum support price (MSP) for the kharif season in a range of 16% to 53% to motivate farmers and compensate for higher input costs but the higher purchase prices could stoke food inflation further. </div><div style="text-align: justify"><br /></div><div style="text-align: justify">The Committee on Economic Affairs ( CCEA) on Thursday raised the MSP of paddy by Rs 170 per quintal and those of oilseeds like groundnut, sunflower seed and niger seed in a range of Rs 600 to 1,000 per quintal. </div><div style="text-align: justify"><br /></div><div style="text-align: justify">The floor price of urad has also been increased by Rs 1,000 per quintal to Rs 4,300 per quintal while the decision on MSPs of key pulses - tur and moong, was deferred. The Commission for Agriculture Prices and Costs (CACP), which recommends MSP for crops every year, has suggested a 28.6% increase for moong and 25% increase on tur pulses. </div><div style="text-align: justify"><br /></div><div style="text-align: justify">The MSP of coarse grains like jowar has seen the biggest jump of 53% to Rs 1,500 per quintal while the floor prices of cotton varieties have been raised by Rs 600 to Rs 800 per quintal. </div><div style="text-align: justify"><br /></div><div style="text-align: justify">The increase in the MSP for paddy from Rs 1,080 per quintal to Rs 1,250 per quintal (common variety) and from Rs 1,110 to Rs 1,270 for 'A' grade variety is expected to increase the acreage under paddy this summer in key states including West Bengal and Andhra Pradesh. At the same time, it is likely to increase the food subsidy bill, which is already hovering around Rs 75,000 crore. </div><div style="text-align: justify"><br /></div><div style="text-align: justify">"The under-provisioning of food subsidy in the current year is at Rs 31,750 crore. Now with increased MSP on paddy, the total food subsidy deficit at the end of the current year will be about Rs 40,000 crore putting immense pressure on the food subsidy burden of the government," said a food ministry official. </div><div style="text-align: justify"><br /></div><div style="text-align: justify">The higher MSP for other crops, especially oilseeds and pulses, will not have direct impact on food subsidy burden but will definitely fuel inflation. </div><div style="text-align: justify"><br /></div><div style="text-align: justify">"Food inflation is already high. An increase in the floor prices of oilseeds and pulses will burn holes in the pockets of consumers. The focus of the government should be to increase the profitability of farmers but not through increasing prices but through improving productivity," said PK Joshi, director, South Asia, International Food Policy Research Institute. </div><div style="text-align: justify"><br /></div><div style="text-align: justify">However, CACP chairman Ashok Gulati argues that this will not impact inflation. </div><div style="text-align: justify"><br /></div><div style="text-align: justify">"The market prices of most of the commodities are already more than the new MSPs. This is not going to push inflation up. In 2011-12, we had imported edible oil and pulses worth more than Rs 50,000 crore. To encourage farmers to plant more oilseeds and pulses, we have recommended to raise MSP, taking their prices closer to the import parity prices," he said. </div><div style="text-align: justify"><br /></div><div style="text-align: justify">Gulati has an advice for reining the food subsidy bill despite the increase in paddy MSP. </div><div style="text-align: justify"><br /></div><div style="text-align: justify">"The government should increase the central issue price - the price at which government sells food grains through ration shops - of rice in sync with the hike in floor prices. The CIP has remained unchanged since 2002 and it should be revised to rein in increasing subsidy," he said.</div><div style="text-align: justify"><br /></div>
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<br><a href="http://economictimes.indiatimes.com/news/economy/indicators/16-53-increase-in-kharif-msp-by-govt-may-stoke-food-inflation/articleshow/14137154.cms" class="re" target="_blank">The Economic Times, 15 June, 2012, http://economictimes.indiatimes.com/news/economy/indicators/16-53-increase-in-kharif-msp-by-govt-may-stoke-food-inflation/articleshow/14137154.cms</a><div class="clear"></div>
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LATEST NEWS UPDATES | 16-53% increase in kharif MSP by govt may stoke food inflation </title>
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The government has increased the minimum support price (MSP) for the kharif season in a range of 16% to 53% to motivate farmers and compensate for higher input costs but the higher purchase prices could stoke food inflation..."/>
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<h1 class="cat-box-title">16-53% increase in kharif MSP by govt may stoke food inflation</h1>
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<div style="text-align: justify">-The Economic Times</div><div style="text-align: justify"><img src="https://im4change.in/siteadmin/tinymce/uploaded/MSP.jpg" alt="MSP" width="280" height="592" /></div><div style="text-align: justify">The government has increased the minimum support price (MSP) for the kharif season in a range of 16% to 53% to motivate farmers and compensate for higher input costs but the higher purchase prices could stoke food inflation further. </div><div style="text-align: justify"><br /></div><div style="text-align: justify">The Committee on Economic Affairs ( CCEA) on Thursday raised the MSP of paddy by Rs 170 per quintal and those of oilseeds like groundnut, sunflower seed and niger seed in a range of Rs 600 to 1,000 per quintal. </div><div style="text-align: justify"><br /></div><div style="text-align: justify">The floor price of urad has also been increased by Rs 1,000 per quintal to Rs 4,300 per quintal while the decision on MSPs of key pulses - tur and moong, was deferred. The Commission for Agriculture Prices and Costs (CACP), which recommends MSP for crops every year, has suggested a 28.6% increase for moong and 25% increase on tur pulses. </div><div style="text-align: justify"><br /></div><div style="text-align: justify">The MSP of coarse grains like jowar has seen the biggest jump of 53% to Rs 1,500 per quintal while the floor prices of cotton varieties have been raised by Rs 600 to Rs 800 per quintal. </div><div style="text-align: justify"><br /></div><div style="text-align: justify">The increase in the MSP for paddy from Rs 1,080 per quintal to Rs 1,250 per quintal (common variety) and from Rs 1,110 to Rs 1,270 for 'A' grade variety is expected to increase the acreage under paddy this summer in key states including West Bengal and Andhra Pradesh. At the same time, it is likely to increase the food subsidy bill, which is already hovering around Rs 75,000 crore. </div><div style="text-align: justify"><br /></div><div style="text-align: justify">"The under-provisioning of food subsidy in the current year is at Rs 31,750 crore. Now with increased MSP on paddy, the total food subsidy deficit at the end of the current year will be about Rs 40,000 crore putting immense pressure on the food subsidy burden of the government," said a food ministry official. </div><div style="text-align: justify"><br /></div><div style="text-align: justify">The higher MSP for other crops, especially oilseeds and pulses, will not have direct impact on food subsidy burden but will definitely fuel inflation. </div><div style="text-align: justify"><br /></div><div style="text-align: justify">"Food inflation is already high. An increase in the floor prices of oilseeds and pulses will burn holes in the pockets of consumers. The focus of the government should be to increase the profitability of farmers but not through increasing prices but through improving productivity," said PK Joshi, director, South Asia, International Food Policy Research Institute. </div><div style="text-align: justify"><br /></div><div style="text-align: justify">However, CACP chairman Ashok Gulati argues that this will not impact inflation. </div><div style="text-align: justify"><br /></div><div style="text-align: justify">"The market prices of most of the commodities are already more than the new MSPs. This is not going to push inflation up. In 2011-12, we had imported edible oil and pulses worth more than Rs 50,000 crore. To encourage farmers to plant more oilseeds and pulses, we have recommended to raise MSP, taking their prices closer to the import parity prices," he said. </div><div style="text-align: justify"><br /></div><div style="text-align: justify">Gulati has an advice for reining the food subsidy bill despite the increase in paddy MSP. </div><div style="text-align: justify"><br /></div><div style="text-align: justify">"The government should increase the central issue price - the price at which government sells food grains through ration shops - of rice in sync with the hike in floor prices. The CIP has remained unchanged since 2002 and it should be revised to rein in increasing subsidy," he said.</div><div style="text-align: justify"><br /></div>
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<br><a href="http://economictimes.indiatimes.com/news/economy/indicators/16-53-increase-in-kharif-msp-by-govt-may-stoke-food-inflation/articleshow/14137154.cms" class="re" target="_blank">The Economic Times, 15 June, 2012, http://economictimes.indiatimes.com/news/economy/indicators/16-53-increase-in-kharif-msp-by-govt-may-stoke-food-inflation/articleshow/14137154.cms</a><div class="clear"></div>
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LATEST NEWS UPDATES | 16-53% increase in kharif MSP by govt may stoke food inflation
16-53% increase in kharif MSP by govt may stoke food inflation
Published on Jun 15, 2012 Modified on Jun 15, 2012
-The Economic Times
The government has increased the minimum support price (MSP) for the kharif season in a range of 16% to 53% to motivate farmers and compensate for higher input costs but the higher purchase prices could stoke food inflation further.
The Committee on Economic Affairs ( CCEA) on Thursday raised the MSP of paddy by Rs 170 per quintal and those of oilseeds like groundnut, sunflower seed and niger seed in a range of Rs 600 to 1,000 per quintal.
The floor price of urad has also been increased by Rs 1,000 per quintal to Rs 4,300 per quintal while the decision on MSPs of key pulses - tur and moong, was deferred. The Commission for Agriculture Prices and Costs (CACP), which recommends MSP for crops every year, has suggested a 28.6% increase for moong and 25% increase on tur pulses.
The MSP of coarse grains like jowar has seen the biggest jump of 53% to Rs 1,500 per quintal while the floor prices of cotton varieties have been raised by Rs 600 to Rs 800 per quintal.
The increase in the MSP for paddy from Rs 1,080 per quintal to Rs 1,250 per quintal (common variety) and from Rs 1,110 to Rs 1,270 for 'A' grade variety is expected to increase the acreage under paddy this summer in key states including West Bengal and Andhra Pradesh. At the same time, it is likely to increase the food subsidy bill, which is already hovering around Rs 75,000 crore.
"The under-provisioning of food subsidy in the current year is at Rs 31,750 crore. Now with increased MSP on paddy, the total food subsidy deficit at the end of the current year will be about Rs 40,000 crore putting immense pressure on the food subsidy burden of the government," said a food ministry official.
The higher MSP for other crops, especially oilseeds and pulses, will not have direct impact on food subsidy burden but will definitely fuel inflation.
"Food inflation is already high. An increase in the floor prices of oilseeds and pulses will burn holes in the pockets of consumers. The focus of the government should be to increase the profitability of farmers but not through increasing prices but through improving productivity," said PK Joshi, director, South Asia, International Food Policy Research Institute.
However, CACP chairman Ashok Gulati argues that this will not impact inflation.
"The market prices of most of the commodities are already more than the new MSPs. This is not going to push inflation up. In 2011-12, we had imported edible oil and pulses worth more than Rs 50,000 crore. To encourage farmers to plant more oilseeds and pulses, we have recommended to raise MSP, taking their prices closer to the import parity prices," he said.
Gulati has an advice for reining the food subsidy bill despite the increase in paddy MSP.
"The government should increase the central issue price - the price at which government sells food grains through ration shops - of rice in sync with the hike in floor prices. The CIP has remained unchanged since 2002 and it should be revised to rein in increasing subsidy," he said.
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