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K.V. Kurmanath

Hyderabad, Sept. 2 The Commission for Agricultural Costs and Prices (CACP) has suggested that the Union Government set up a “Price Stabilisation Fund”, particularly for sugarcane, to insulate farmers from the vagaries of occasional slumps in prices.

“We have recommended them to set up the fund with an initial corpus that could be decided by an expert committee. The fund could be tapped if the mills are not in position to pay off dues. The farmers should not suffer,” Prof S. Mahendra Dev, Chairman of CACP, told Business Line.

The Commission has recently submitted a report in March 2008, recommending MSP (minimum support price) for 15 crops, including rice, maize and cotton.

The SMP (statutory minimum price) for sugarcane, which used to be Rs 81 a quintal, might get a significant boost this year with a likely hike of up to 50 per cent. This could be done as a one-off hike to keep in tandem with the significant increase in MSPs for other crops. The CACP has scheduled a workshop in New Delhi in October-November where stakeholders such as officials and farmers would be invited to get inputs on pricing aspects.

Prof Dev had recently visited parts of Andhra Pradesh to elicit opinion of the farmers on cost of production of paddy that varied between Rs 12,000-20,000 an acre.

Prof Dev said CACP would be better off with autonomous status. “As of now, the commission could recommend MSPs. But if it becomes an autonomous body its recommendations would become mandatory,” he pointed out.

“To arrive at a price, we are depending on the data provided by Government agencies. We could address these inefficiencies in data collection by having our own network of data collection sources, should we have autonomy,” he said.

Besides, the commission could get a holistic picture through considering non-price factors.

More Stories on : Agricultural Policy | Sugar

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