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The Standing Committee on Agriculture, led by Charanjit Singh Channi, recommended a legally guaranteed Minimum Support Price (MSP) for crops to address farmer distress.
The panel linked the implementation of MSP to reducing farmer suicides and enhancing rural economic growth.
It proposed increasing the PM-KISAN scheme amount to ₹12,000 annually from ₹6,000 and extending benefits to tenant farmers and farm labourers.
The report emphasized that a legal MSP would boost farmer income, increase agricultural investment, and ensure long-term food security.
Legal MSP would protect farmers from market fluctuations, reduce debt burdens, and improve mental health by providing financial stability.
Minimum Support Price (MSP)
It is a form of market intervention by the Central Government to insure agricultural producers against any sharp fall in farm prices.
It protects the producer- farmers against distress sale during bumper production years.
The Union Government sets a MSP for 22 crops before the sowing period every year, based on a formula of one-and-a-half times production costs
MSP is fixed on the recommendations of the Commission for Agricultural Costs and Prices (CACP), an apex advisory body for pricing policy under the Ministry of Agriculture
It is implemented mostly for rice and wheat mainly because India has vast storage facilities for these grains and uses the produce for its public distribution system (PDS).
It takes into account both paid-out costs such as seeds, fertilisers, pesticides, fuel, irrigation, hired workers and leased-in land, as well as the imputed value of unpaid family labour.
However, there is currently no statutory backing for these prices, nor any law mandating their enforcement.
A farmer cannot demand MSP as a matter of right.
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