Financial Daily from THE HINDU group of publications
Tuesday, Feb 28, 2006
Financial Daily from THE HINDU group of publications Tuesday, Feb 28, 2006 |
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Agri-Biz & Commodities
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Economic Survey Call to rationalise support prices Our Bureau
New Delhi , Feb. 27 The Union Government on Monday called for rationalisation of minimum support price (MSP) regime since it predominantly helps large farmers. It also called for discouraging State-level taxes imposed by foodgrain producing States such as Punjab and Haryana. "As MSPs help only the large farmers with high marketable surpluses and marginalise the rest of them, the non-price factors such as those related to provision of infrastructure need to be considered," the Economic Survey said. It also called for the scope to improve the efficiency of Food Corporation of India by reducing operating costs as FCI is fully reimbursed for its procurement, handling and storage costs. `Mandi' fees flayed
State-level sales taxes and marketing committee fees (mandi fees) on procurement operations in Punjab and Haryana inflate the economic cost of foodgrains. The average consumer in all States and the States who are net buyers of foodgrains bear the incidence of such sales taxes and duties. There is a need to explore the possibility of combining moral suasion with some incentive/disincentive to discourage States from imposing such levies, it said.
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