How many Indian farmers and rural households are aware of the Minimum Support Price (MSP)?
Despite the fact that farmers protesting farm laws have been demanding guaranteed Minimum Support Price (MSP), the majority of agricultural households in India are unaware of the MSP concept. The percentage of agri output sold by rural households under the MSP ranges from 0 to 24.7% (except sugarcane). Households growing wheat and paddy dominate the charts of MSP awareness and agri output sold under the MSP.
Surprisingly, only half of the households growing various crops for sale are aware of procurement agencies. The MSP awareness data was disclosed in the Situation Assessment of Agricultural Households and Land and Holdings of Households in Rural India – 2019 (National Sample Survey – NSS 77th round).
MSP is known to approximately 52.8% of paddy growing households (January-June 2019) and 40.7% of paddy growing households (July-December 2018). Approximately 39.8% of sugarcane growing households, 31.7% of Bajra growing households, 30.7% of cotton growing households, and 28.3% of soybean growing households were aware of MSP (July–December 2018).
Between January and June of this year, more than half of sugarcane growing households reported being aware of MSP. MSP awareness was reported by 41.2% of Arhar (Whole pigeon pea) growing households, 39.2% of rapeseed growing households, and 37.1% of wheat growing households.
Agency for Procurement
The percentage of households who are aware of procurement agencies under MSP ranges from 3.1 to 40.3% (except sugarcane). When it comes to the maximum percentage of output sold under MSP, paddy growing households top the list.
As per data from the NSS 70th round, the Shanta Kumar Committee report, released in 2015, only 6% of all farmers benefited from MSP through the sale of food grains to an official procurement agency.
After considering the recommendations of the Commission for Agricultural Costs and Prices, the government of India announces Minimum Support Prices (MSP) for 22 major agricultural commodities of Fair Average Quality (FAQ) each year during both crop seasons (CACP). The procurement at MSP is carried out by Union and State Agencies under various government schemes.
Narendra Singh Tomar, Union Minister of Agriculture and Farmers Welfare, told the Lok Sabha in July that the MSP policy has nothing to do with new agricultural laws.
Growers are free to sell their agri produce to government procurement agencies at MSP or to the Agricultural Produce Market Committee (APMC) markets, through contract farming, or in the open market, whichever is more beneficial for them.