MSP for farmers: Exposing the lies of the Modi government

The Narendra Modi-led, NDA II government has resorted to a series of manipulations of figures and data, in an attempt to show that it actually stands for Indian farmers. Farmers have been reeling under the acute distress caused by the Covid-19 lockdown and the agrarian crisis.

On an overdrive to justify the hasty passage of the three bills[1] that threaten the autonomy, livelihood and dignity of India’s Farmers, the Modi 2.0 government is on a propaganda drive, set to deceive the urban middle class (and the farmer) on the issue of Minimum Support Price (MSP) of farmers paid out.

Has there been a hike in the MSP for the Rabi Season (2020-21)?

Fact Check

The government claims that under its watch, there has been a substantial hike in MSP the for Rabi Marketing Season 2021-22 in line with the recommendations of Swaminathan Commission (following the principle of fixing the MSPs at a level of at least 1.5 times of the All-India weighted average Cost of Production).

So, is the MSP being offered by this government actually being calculated on the basis of C2 Costs?

Has the ‘benevolent’ government accepted the longstanding demand of the farmers to fix MSP as per C2+50% recommended by the Swaminathan Commission?

Let’s have a look.

A close look at the Rabi Price Policy Report 2021-22 of the Commission on Agricultural Costs and Prices (CACP) reveals that that what has been actually used as the base cost to calculate MSP are the A2+FL prices alone.

The table below gives an idea about the huge difference between C2 Costs and A2+FL Costs.

The huge difference between C2+50% and the MSP announced, now becomes clear.

Difference Between C2 and A2+FL

WHEAT

Lets take wheat which is the main Rabi crop,

The C2 cost calculated by the main wheat growing States of Punjab and Haryana was Rs.1864/ quintal and Rs.1705/ quintal, respectively.

However, the Centrally controlled CACP figures show the C2 cost for Punjab only as Rs.1287/quintal which is Rs.577/quintal lower for the Punjab. For Haryana, CACP (fudged) figures show the C2 cost at Rs.1500/quintal or Rs.205/quintal below the State Government calculations.

It is the states who calculate the C2 costs. But the Modi government is using depressed costs, decided by the CACP and a weighted average of costs of all States has arrived at a figure (A2 + FL, as shown in the Table) which are far below the C2 costs.

Result: As the A2+FL figures in the table show, these are at base level far below the C2 costs so arrived; in the case of wheat it is Rs.507/Qtl lower than C2 costs.

The Ffarmer who cultivates wheat is being duped by this ingenuous (or cynical) manipulation of pricing figures)

BARLEY, GRAM, LENTILS, RAPESEED, MUSTARD AND SAFFLOWER SEED:

In Barley the difference between the two methods of calculation amounts to Rs.433/quintal, Rs.1,146/quintal for Gram Rs.1,340/quintal for Lentils, Rs.1055/quintal for Rapeseed and Mustard; and Rs.1357/quintal for Sunflower.

Difference Between C2+50% and Rabi MSP 2021-22

If the MSP had been actually been guaranteed as per C2+50% even taking CACP calculations the farmer would have got Rs.220.5/quintal more for wheat, Rs.506/ quintal more for Barley, Rs.918/ quintal more for Gram, Rs. 1206/ quintal more for Lentil, Rs.600/ quintal more for Rapeseed and Mustard and Rs.2035/ quintal more for Safflower.

Indian farmers are already incurring huge losses due to the obstinate refusal of the Narendra Modi led BJP Government to fix MSP as per C2+50%.  The reality is that crops are not even procured at the rates mentioned here. Only about 30 per cent of total wheat production is actually procured at MSP. In most other crops MSP remains notional as there is no procurement by government.

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