It’s M.P., not Haryana or Punjab, which reaped the benefits of MSP the most

The protest against the Centre’s newly introduced farm laws is loudest in Punjab and Haryana, where the MSP mechanism is robust, benefiting wheat growing farmers. However, government data shows that Madhya Pradesh farmers have steadily taken over wheat growers in Punjab and Haryana to reap benefits of MSP in the last five years.

Data from rabi marketing seasons (RMS) 2016-17 to 2020-21 shows that 47,58,350 farmers from Madhya Pradesh availed of the wheat procurement — much higher than the 44,56,516 farmers from Punjab and 37,30,443 farmers from Haryana.

Also, according to FCI data, 129.42 LMT wheat was procured in Madhya Pradesh in the 2020-21 RMS compared to 127.14 LMT in Punjab and 74 LMT in Haryana.

In 2016-17 RMS, of the total farmers (20,46,766) who benefitted from wheat procurement in India, 41 per cent were from Punjab and 23 per cent from Haryana, and just 26 per cent from Madhya Pradesh.

The data presented by the Ministry of Consumer Affairs, Food and Public Distribution in the Rajya Sabha in September this year shows that the transition started in the 2018-19 RMS, when 9,58,417 (24 per cent) farmers from Madhya Pradesh reaped the benefits of MSP in wheat procurement compared to 8,97,905 (23 per cent) Punjab farmers. That year, Uttar Pradesh reported the highest number of beneficiary farmers (27 per cent).

Since 2018-19, the number of wheat farmers in Madhya Pradesh benefiting from MSP has grown constantly. In 2019-20, the number of benefitting farmers went up to 27 per followed by Haryana (25 per cent) and Punjab (23 per cent). In 2020-21, the number of benefitng farmers in Madhya Pradesh is 37 per cent, while those in Punjab came down to 24 per cent and Haryana 18 per cent.

Agriculture in Punjab grew at a high growth rate of 5.7 per cent during 1971-72 to 1985-86, which was more than double the all-India growth rate (2.31 per cent) during this period.

Punjab’s agri growth

Punjab first witnessed large wheat surpluses followed by a steep rise in production of rice and played a crucial role in achieving food security for India.

However, the State slipped soon after and grew at a lower rate of about 3 per cent between 1986-87 and 2004-05, equivalent to the all-India agricultural growth rate. The situation has deteriorated further as Punjab’s agricultural GDP grew at only 1.61 per cent per annum, less than half the all-India average growth rate of 3.5 per cent in the period between 2005-06 and 2014-15.

“The future of Punjab’s agricultural prosperity lies in the high-value sectors of agriculture,” stated a report titled ‘Getting Punjab Agriculture Back on High Growth Path: Sources, Drivers and Policy Lessons’ by Ashok Gulati, Ranjana Roy and Siraj Hussain.

The report recommended diversification from common rice in the kharif season. It insisted on encouraging processing industries by liberalising land lease markets, developing contract farming, rationalising tax structure on raw commodities — especially wheat and rice — and revisiting tax rates approved by the GST Council for processed food under new the GST regime.

Interestingly, when it comes to paddy procurement, Chhatisgarh and Telangana farmers have reaped more MSP benefit in the last five years compared Punjab and Haryana.

While Punjab and Haryana farmers continue to agitate apprehending that MSP mechanism will be scrapped, farmers in other States have already left them behind in reaping the MSP benefits.

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