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LATEST NEWS UPDATES | MSP For One Third of Total Production. What About the Rest? -Subodh Varma

MSP For One Third of Total Production. What About the Rest? -Subodh Varma

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published Published on Jul 10, 2018   modified Modified on Jul 10, 2018
-Newsclick.in

Govt. buys only about one third of the total rice and wheat produced and MSP is paid for that only.

The recent announcement of Minimum Support Prices for 14 kharif crops including paddy and many coarse grains has been met with a frenzy of self-congratulation by the Modi govt. and the BJP, egged on by an embarrassingly sycophantic mainstream media. Many have however pointed out that the declared MSP is not 50% more than the total cost of inputs, as recommended by the Swaminathan Commission, and reiterated by BJP and Modi as an election promise.

But there is more to this than just a deficient MSP. Previous years’ data shows that wheat procurement by central and state govt. agencies added up to about 28-30%, as per the reports put out by the Department of Food & Public Distribution. In 2017-18, govt. bought 30.8 million tonnes of wheat while the total production was 98.61 million tonnes. That’s 31% of the total. In a bad year, like 2016-17 when crops are affected by drought, procurement fell to just 23%.

So, what happens to the rest of wheat? Substantial portion of it is self-consumed by small and marginal farmers, and even medium farmers. This is how they are surviving. According to govt. figures, in richer states like Punjab and Haryana farmers sell more of their production (called marketable surplus) than poorer states like Bihar. Also, procurement machinery is much more extensive in these very states. So, in Punjab, out of an average 15.7 million tonnes wheat produced annually during 2014-15 to 2016-17, 14 million tonnes was sold in the markets and 10.9 million tonnes was procured by the govt. – at MSP rates. But in Bihar, out of the average 4.5 million tonnes produced annually, 3.7 million tonnes were marketed and nothing was procured by the govt. All of it was sold below the declared MSP!

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Newsclick.in, 7 July, 2018, https://newsclick.in/msp-one-third-total-production-what-about-rest


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