May 12, 2022
About Procurement of Wheat
Centralised Procurement System
Decentralised Procurement System
What is the Cost to the Government of Procurement?
How will Minimum Support Price (MSP) rescue the farmers from the low income trap?
Related Video:
Minimum Support Price (MSP): Simply put, the MSP for a crop is the price at which the government is supposed to procure/buy that crop from farmers if the market price falls below it. MSPs provide a floor for market prices, and ensure that farmers receive a certain “minimum” remuneration so that their costs of cultivation (and some profit) can be recovered. Using MSPs, the government incentivises the production of certain crops, thus ensuring that India does not run out of staple food grains. Typically, MSPs create the benchmark for farm prices not just in those commodities for which they are announced, but also in crops that are substitutes. Crops covered by MSPs include: 7 types of Cereals (paddy, wheat, maize, bajra, jowar, ragi and barley), 5 types of Pulses (chana, arhar/tur, urad, moong and masoor), 7 Oilseeds (rapeseed-mustard, groundnut, soyabean, sunflower, sesamum, safflower, niger seed), 4 Commercial crops (cotton, sugarcane, copra, raw jute) |
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