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India Farm and Forest

Farmers reject Centre’s committed MSP prices

Unions like the AIKS and JKA point out how the suggested prices fail to account for the growing inflation in the economy

Sabrangindia 13 Jun 2022

AIKS
Representation Image

Farmer union bodies condemned the Centre’s recommended Minimum Support Price (MSP) for Kharif 2022-23 crops which accounted for less than a 10 percent increase. The Commission for Agricultural Costs and Prices’ (CACP) report suggested a meagre five percent increase for paddy crops!

According to the All India Kisan Sabha (AIKS), the central government defrauded farmers by making miniscule increases in the MSP for kharif crops. As per the report, paddy and groundnut crops received only a five percent increase in MSP, while Jowar crops received around eight percent MSP increase. Yellow soyabean was the only crop to receive an increase of nearly nine percent (8.9 percent).

MSP

Stating that these recommendations barely covered the general inflation in the economy, the AIKS pointed out how cost of production has increased sharply due to high prices of fuel and other inputs, massive shortages and price-rise in fertilizers supplies.

“Even in the last season, black marketing of fertilizers was rampant because of shortages of supply. The situation has turned worse in the recent months because of sanctions by the US and EU against Belarus and Russia,” said AIKS General Secretary Hannan Mollah.

Meanwhile, higher global prices of food commodities like edible oils and pulses, for which India is import-dependent, ensure much higher payments to farmers of developed countries rather than India’s domestic farmers.

“Rather than offering remunerative prices to our own farmers so that India's import dependence could be reduced, government is discriminating against them,” said Mollah.

Circling back to farmers’ long standing demand of MSP as per the Swaminathan Commission formula, the AIKS said that the government grossly underestimated the cost of production for Kharif 2022-23. It said that the department should compute the return over total cost (C2) rather than computing the return over A2+FL cost. The latter excludes the cost of the farmer’s own resources. Leaders said this is why the government should employ the C2+50 percent formula that realistically estimates the total cost of production and ensures that farmers are paid a 50 percent return over that.

JKA claims reduced MSP

While the AIKS called the recommended prices paltry, the Jai Kisan Andolan declared the MSP of 11 out of 14 crops to be reduced in real terms. According to JKA Founder Yogendra Yadav, the Reserve Bank of India’s (RBI) monetary policy committee on June 8, 2022 had forecast a 6.7 percent inflation in FY-23. In terms of input cost for farmers, increase in diesel and fertilizer prices worsens the impact of inflation on peasants.

“If the inflation in input cost for farmers is compared to the MSP declared by the government, then it is clear that for 11 out of 14 crops, the increase in MSP is less than the cost inflation. Thus, in real terms, the MSP has been reduced for 11 crops,” said Yadav.

MSP

The JKA leader further said that when compared with the MSP increases during the UPA-regime, the BJP-led government has offered lower increases in the procurement prices.

Similarly, JKA President Avik Saha said, “Every year, in the name of MSP, this government hands out betrayal to farmers. Now it is clearly evident that the farmers are left with no other option than a struggle for legal guarantee of MSP based on the comprehensive cost.”

14 states demanded higher MSP for paddy

On June 13, the Indian Express reported how 14 out of 15 states and Union Territories (UTs), which suggested an MSP for paddy, recommended higher procurement prices than those mentioned in the government report.

As shown in the above table, the Centre announced MSP for paddy (common) at ₹ 2,040 per quintal and for paddy (grade A) at ₹ 2,060 per quintal for the kharif marketing season 2022-23. However, as many as 15 states and UTs had suggested the paddy MSP in the range of ₹ 2,000 to ₹ 4,513 per quintal based on their production cost projection.

Only Jammu and Kashmir suggested a lower paddy MSP than the one declared by the Centre. Whereas Andhra Pradesh, Andaman and Nicobar Islands, Bihar, Chhattisgarh, Gujarat, Jharkhand, Karnataka, Kerala, Maharashtra, Odisha, Punjab, Tamil Nadu, Telangana and West Bengal all suggested higher prices. Further, six states — Assam, Haryana, Himachal Pradesh, Madhya Pradesh, Uttar Pradesh and Uttarakhand (all ruled by the BJP) — did not offer any prices for the paddy MSP.

West Bengal, Uttar Pradesh, Punjab, Odisha, Andhra Pradesh, Telangana, Tamil Nadu, Chhattisgarh, Bihar and Assam are the main paddy growing states. The MSP on the crop is significant because 1.17 crore farmers benefited from it during the kharif marketing season 2021-22.

PDS required aside from MSP

While talking about better MSP prices to incentivize farmers, the farmers unions also urged the Centre to ensure that systems of public procurement are put in place for pulses, oilseeds and millets. Procurement from mechanisms like the Public Distribution System (PDS) incentivizes farmers to grow more of these crops which in turn reduces India's import dependence. Moreover, inclusion of edible oil and pulses will incentivise farmers to grow water-saving crops and help bring down food inflation. This will improve the food security in India, said the AIKS.

“Since there is no government procurement in most parts of the country, only a small fraction of farmers in India will be able to avail of the paltry MSP declared by the central government,” said Mollah.

Therefore, the farmers body called upon farmers across India to protest against the committed MSP and rally to demand a statutory right to remunerative MSP for their crops.

Related:

Modi’s eight years: Eight acts of shameful disgrace

78 percent Maharashtra households suffered food insecurity: Hunger Watch II report

Lakhimpur Kheri case: Third witness attacked, survives firing by goons

Pan-India farmers protest over attack on Rakesh Tikait!

Farmers reject Centre’s committed MSP prices

Unions like the AIKS and JKA point out how the suggested prices fail to account for the growing inflation in the economy

AIKS
Representation Image

Farmer union bodies condemned the Centre’s recommended Minimum Support Price (MSP) for Kharif 2022-23 crops which accounted for less than a 10 percent increase. The Commission for Agricultural Costs and Prices’ (CACP) report suggested a meagre five percent increase for paddy crops!

According to the All India Kisan Sabha (AIKS), the central government defrauded farmers by making miniscule increases in the MSP for kharif crops. As per the report, paddy and groundnut crops received only a five percent increase in MSP, while Jowar crops received around eight percent MSP increase. Yellow soyabean was the only crop to receive an increase of nearly nine percent (8.9 percent).

MSP

Stating that these recommendations barely covered the general inflation in the economy, the AIKS pointed out how cost of production has increased sharply due to high prices of fuel and other inputs, massive shortages and price-rise in fertilizers supplies.

“Even in the last season, black marketing of fertilizers was rampant because of shortages of supply. The situation has turned worse in the recent months because of sanctions by the US and EU against Belarus and Russia,” said AIKS General Secretary Hannan Mollah.

Meanwhile, higher global prices of food commodities like edible oils and pulses, for which India is import-dependent, ensure much higher payments to farmers of developed countries rather than India’s domestic farmers.

“Rather than offering remunerative prices to our own farmers so that India's import dependence could be reduced, government is discriminating against them,” said Mollah.

Circling back to farmers’ long standing demand of MSP as per the Swaminathan Commission formula, the AIKS said that the government grossly underestimated the cost of production for Kharif 2022-23. It said that the department should compute the return over total cost (C2) rather than computing the return over A2+FL cost. The latter excludes the cost of the farmer’s own resources. Leaders said this is why the government should employ the C2+50 percent formula that realistically estimates the total cost of production and ensures that farmers are paid a 50 percent return over that.

JKA claims reduced MSP

While the AIKS called the recommended prices paltry, the Jai Kisan Andolan declared the MSP of 11 out of 14 crops to be reduced in real terms. According to JKA Founder Yogendra Yadav, the Reserve Bank of India’s (RBI) monetary policy committee on June 8, 2022 had forecast a 6.7 percent inflation in FY-23. In terms of input cost for farmers, increase in diesel and fertilizer prices worsens the impact of inflation on peasants.

“If the inflation in input cost for farmers is compared to the MSP declared by the government, then it is clear that for 11 out of 14 crops, the increase in MSP is less than the cost inflation. Thus, in real terms, the MSP has been reduced for 11 crops,” said Yadav.

MSP

The JKA leader further said that when compared with the MSP increases during the UPA-regime, the BJP-led government has offered lower increases in the procurement prices.

Similarly, JKA President Avik Saha said, “Every year, in the name of MSP, this government hands out betrayal to farmers. Now it is clearly evident that the farmers are left with no other option than a struggle for legal guarantee of MSP based on the comprehensive cost.”

14 states demanded higher MSP for paddy

On June 13, the Indian Express reported how 14 out of 15 states and Union Territories (UTs), which suggested an MSP for paddy, recommended higher procurement prices than those mentioned in the government report.

As shown in the above table, the Centre announced MSP for paddy (common) at ₹ 2,040 per quintal and for paddy (grade A) at ₹ 2,060 per quintal for the kharif marketing season 2022-23. However, as many as 15 states and UTs had suggested the paddy MSP in the range of ₹ 2,000 to ₹ 4,513 per quintal based on their production cost projection.

Only Jammu and Kashmir suggested a lower paddy MSP than the one declared by the Centre. Whereas Andhra Pradesh, Andaman and Nicobar Islands, Bihar, Chhattisgarh, Gujarat, Jharkhand, Karnataka, Kerala, Maharashtra, Odisha, Punjab, Tamil Nadu, Telangana and West Bengal all suggested higher prices. Further, six states — Assam, Haryana, Himachal Pradesh, Madhya Pradesh, Uttar Pradesh and Uttarakhand (all ruled by the BJP) — did not offer any prices for the paddy MSP.

West Bengal, Uttar Pradesh, Punjab, Odisha, Andhra Pradesh, Telangana, Tamil Nadu, Chhattisgarh, Bihar and Assam are the main paddy growing states. The MSP on the crop is significant because 1.17 crore farmers benefited from it during the kharif marketing season 2021-22.

PDS required aside from MSP

While talking about better MSP prices to incentivize farmers, the farmers unions also urged the Centre to ensure that systems of public procurement are put in place for pulses, oilseeds and millets. Procurement from mechanisms like the Public Distribution System (PDS) incentivizes farmers to grow more of these crops which in turn reduces India's import dependence. Moreover, inclusion of edible oil and pulses will incentivise farmers to grow water-saving crops and help bring down food inflation. This will improve the food security in India, said the AIKS.

“Since there is no government procurement in most parts of the country, only a small fraction of farmers in India will be able to avail of the paltry MSP declared by the central government,” said Mollah.

Therefore, the farmers body called upon farmers across India to protest against the committed MSP and rally to demand a statutory right to remunerative MSP for their crops.

Related:

Modi’s eight years: Eight acts of shameful disgrace

78 percent Maharashtra households suffered food insecurity: Hunger Watch II report

Lakhimpur Kheri case: Third witness attacked, survives firing by goons

Pan-India farmers protest over attack on Rakesh Tikait!

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