The Bharat brand scheme aims to stabilise prices for consumers and ensure fair compensation to farmers. However, its impact will be limited due to State laws Last year in July, the Union Government launched a Scheme of selling chana dal at a subsidised rate under the Bharat brand call it Bharat Chana. This was followed by launch of Bharat Atta in November 2023 and Bharat Rice in February 2024, Under the Scheme, the Food Corporation of India (FCI) – a central agency whose prime responsibility is to procure, store and distribute food grains to meet the needs of beneficiaries covered under the National Food Security Act (NFSA) – buys the cereals from the farmers and sells to the National Agricultural...
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Category: Agriculture & Foodgrain
MSP methodology and farmer demands
Questions arise about the rationale and implications of adopting Dr Swaminathan’s proposed methodology for MSP calculation Co-terminus with the legal guarantee for Minimum Support Price (MSP) for all crops, another demand raised by the farmers relates to how the MSP is fixed. They want it to be calculated based on the recommendations of the National Commission on Farmers (NCF) under Dr MS Swaminathan (2006). All along, the Commission for Agricultural Costs and Prices (CACP) – a statutory body under the Ministry of Agriculture & Farmers Welfare – has been setting MSP at the level of the so-called comprehensive cost or C2 cost. C2 is arrived at by adding three components viz. A2 covers all paid-out expenses, both in cash and...
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Farmers’ demands are impractical and unrealistic
The farmers want the Govt to withdraw from the WTO and all Free Trade Agreements, which is next to impossible in a globally interdependent world After three years of hibernation, farmers mostly from Punjab are back on the roads with over a dozen demands from the Union Government. If taken on board, these are sure to spell disaster. The foremost demand is securing legal guarantees for the Minimum Support Price (MSP) of their agricultural produce. MSP is a “minimum price” for any crop that the government considers as remunerative for farmers and hence deserving of “support”. Put into practice in the 1960s under an ‘executive order’, it was meant to assure farmers that they get at least MSP from selling...
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MSP guarantee is bad economics
Yet, political parties give because it helps them win elections. MSP representative image. Credit: DH File Photo In the recently concluded state assembly elections, among the various guarantees made by the BJP—Modi’s guarantees—a significant commitment is a hefty increase in the minimum support price (MSP) for paddy and wheat offered to farmers in Madhya Pradesh and Chhattisgarh. In MP, the party promised an MSP of Rs 3,100 per quintal for paddy, a 42% increase from the current Rs 2,183 per quintal fixed by the Centre. For wheat, the promised MSP is Rs 2,700 per quintal, a 27% rise from the existing Rs 2,125 per quintal. In Chhattisgarh, a commitment was made to procure paddy at an MSP of Rs 3,100...
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Has free ration become a political compulsion?
Under ‘open-ended’ procurement, Govt buys from farmers unlimited quantities at MSP. Apart from high stocks, this adds to the food subsidy bill substantially Addressing a poll rally in Chhattisgarh, Prime Minister Narendra Modi has announced an extension of the Pradhan Mantri Garib Kalyan Anna Yojana (PMGKAY) free ration scheme for another five years. Launched in April 2020 to deal with the situation triggered by the Covid-19 pandemic, PMGKAY provided 5 kg of rice or wheat per person per month for “free” to 820 million, as well as 1 kg of pulses per family per month to people covered under the National Food Security Act (NFSA). Run for three months initially, the scheme got six extensions till December 31, 2022. On...
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Rethink rationale for food subsidy
Most of its actions in implementing the food subsidy scheme are out of sync with the changing times and lead to leakages and corruption The NITI Aayog has invited bids for a Central Coordinating Agency that can study the effectiveness of its National Food Security Subsidy scheme. The Agency will hold the mandate to suggest ways to better the scheme. It will also suggest ‘whether, and how, the scheme can be rationalised or closed’. However, the government’s move to continue the supply of free food grains under the National Food Security Act (NFSA) beyond the current FY gives the contrary signal. In fact, most of its actions in implementing the food subsidy scheme are out of sync with the thought...
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Agri-trade: Hamstrung by state laws
To boost inter-mandi and inter-state trade in agricultural commodities, a high-level Expert Committee set up by the Ministry of Agriculture & Farmers Welfare has recommended creation of specialized Market Yard of National Importance (MNI) which could complement e-NAM (electronic National Agriculture Market). It has proposed creation of MNIs for selected commodities in six states. According to the committee, “MNI could be construed as a specialized extension of e-NAM”. At the outset, it is important to understand what is e-NAM? What is it that e-NAM hasn’t been able to achieve? How can MNI make up and fill the void? Launched in April 2016, e-NAM is an online trading platform for agriculture produce aiming to help farmers, traders, and buyers with online trading and...
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MSP guarantee will spell disaster for farmers
The hapless farmers must be liberated from the stranglehold of cartel licenced traders by giving them options to sell their produce wherever they want Union leaders may have called off farmers’ agitation in Haryana over Minimum Support Price (MSP) for sunflower seeds following the State government’s decision to agree to their demand. However, they maintain that their protest for securing legal guarantees for MSP across the country will continue. A legal guarantee for MSP was a major demand of the farmers mainly from Punjab, Haryana and western Uttar Pradesh during the year-long protest in 2020/2021 over the three Central farm laws. That protest ended when Prime Minister Narendra Modi announced on November 19, 2021, the repeal of those laws. Do...
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No fertile future yet for farmers’ scheme
PM-KISAN’s benefits are being extended to many who don’t deserve them, but they elude the needy According to a statement made by the government in Parliament, the number of farmers receiving income transfers under the Pradhan Mantri Kisan Samman Nidhi (PM-KISAN) Scheme declined from 104 million during 2021-22 to 80 million during 2022-23. There has been a corresponding reduction in payments from Rs 67,032 crore during 2021-22 to Rs 57,646 crore in 2022-23. Launched by Prime Minister Narendra Modi on February 24, 2019, and made effective from December 1, 2018, PM-KISAN is a central sector scheme. Under it, the Union government gives Rs 6,000 a year to each farmer with a valid enrolment. It is paid in three instalments of...
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Fine tune PM-KISAN to be efficacious
The inclusion of ineligible persons on the beneficiaries list of PM-KISAN raises concerns and undoes the very purpose the scheme was launched for A significant decline in the number of farmers receiving income transfers under the Pradhan Mantri Kisan Samman Nidhi (PM-KISAN) Scheme from 104 million during 2021-22 to 80 million during 2022-23 and a corresponding reduction in payment from Rs 67,032 crore in 2021-22 to Rs 57,646 crore in 2022-23 has caused much consternation. Launched by Prime Minister Narendra Modi on February 24, 2019, and made effective from December 1, 2018, PM-KISAN is a Central Sector Direct Benefit Transfer (DBT) Scheme under which the Union Government. It provides an income support of Rs 6,000 a year to farmers with...
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