Agri Business


Farmers’ organisations feel support price hike for foodgrains ‘inadequate’

Our Bureaus New Delhi/Bengaluru/Hyderabad/Chennai/Ahmedabad/Mumbai | Updated on July 04, 2018 Published on July 04, 2018

In 2008-09, which was also an election year, the UPA government had announced a hike in MSP for paddy by 20.8 per cent, but the present hike is just 12.9 per cent   -  M SRINATH

Raise questions over modalities of govt support and procurement mechanism

Farmers and farmers’ representatives have uniformly criticised the hike in MSP as inadequate and disappointing.

That the government has not taken into account the land cost in calculating the cost of production of various crops has handicapped the whole process, they feel.

Also, the hike in support prices by itself cannot help augment farmers’ income, they feel.

Only a small percentage of the farmers benefit from government procurement, while a majority are left out and do not get the support prices, they point out.

A wide cross-section of farmers and their organisations that BusinessLine spoke too felt let down.

The Centre has done little and done it late is the general sentiment.

Buying operations

The AIKMS has strongly criticised the hike in MSP without the guarantee of procurement. This will mean that more than 90 per cent of the farmers will not get the benefit of the support prices.

Without including the cost of rent for land, the hike is just 12 per cent for paddy and about 5 per cent for pulses. The government has not helped bring down input prices which is adding to the debt of farmers, while the corporate sector that sells the inputs benefits.

Yogendra Yadav, President of Swaraj India, and Founder of Jai Kisan Andolan, congratulated the farmers’ organisations that compelled the government to acknowledge farmers’ issues. “The MSP announcements of Kharif 2018-19 is a small victory for farmers” at least on paper, it has acted on the promise of remunerative MSP.

But it is inadequate as the price computed is not at 50 per cent above comprehensive cost (C2) being demanded by farmers’ organisations. Even the price announced depends on government procurement and support, which has been lacking till now. MSP, without a legal framework, is not a permanent solution as it is discretionary.

Avik Saha, National Convenor of Jai Kisan Andolan, said a comparative chart based on the official figures shows that there is nothing historic or substantial about the MSP hike — it is in fact lower than the hikes given by UPA II. For example, in 2008-09, which was also an election year, the UPA government had announced a hike in MSP for paddy by 20.8 per cent, but the present hike is just 12.9 per cent.

Jai Kisan Andolan is a constituent member of All India Kisan Sangharsh Coordination Committee (AIKSCC), an apex body of 194 farmers organisations from across the country.

Sarampally Malla Reddy, Telangana Rythu Sangham, said the hike in MSP is too little. It does not even cover the increases in the input prices. “The cost of production in paddy per acre has gone up by ₹8,000 to ₹30,000.”

“The Telangana government has pegged the cost of production at ₹2,100 a quintal. If you add 50 per cent more as recommended by the Swaminathan Commission, the MSP should be ₹3,150.”

Groundnut farmers

In Gujarat, while welcoming the move, farmers also raised concern about the transparency and effectiveness of procurement mechanism under the newly-announced MSP.

For groundnut farmers, the experience of last kharif season was a nightmare as they ended up selling their produce in the open market at rates lower than the MSP. Vitthal Dudhatra, President, Gujarat Pradesh of Bhartiya Kisan Sangh (BKS), said, “Even at the current MSP the government isn’t able to execute adequate procurement, what benefit can we expect from the newly announced MSP? The government needs to come out with a proper plan, how would they procure, if the prices dip below MSP,” said

Delayed announcement

The President of the All Indian Kisan Sabha and Central Committee member of CPI(M), Ashok Dhawale said the delay in making the announcement is unprecedented, ideally, the announcement should have been made by June 15.

Farmers in the country will not get any benefits from the announcement because they have completed sowing of their crops. Without an efficient procurement, farmers will again be left to the mercy of the traders.

Dhawale added that the government has not followed the formulae mentioned in the Swaminathan Commission Report for fixing the prices.

President of the Shetkari Sanghatana, Raghunath Patil, said the increase in MSP for paddy is minimal and is not enough to recover the cost of production. The government imported tur from Mozambique at ₹13,500/quintal. It is ready to give higher prices to the farmers in Mozambique but not in India, he said.

S Ranganathan, General Secretary, Cauvery Delta Farmers Welfare Association, said the MSP hike was a “disappointment”. After the expectations raised by the Centre, the ₹200/quintal hike does not adequately compensate the farmers in terms of 50 per cent increase over cost of production or helping in anyway to double farmers’ income by 2022 as targeted by the government.

“Even assuming a thumb rule based on the crop loan of about ₹ 30,000 an acre given by the co-operative banks, it takes the farmers at least ₹45,000 to get the crop to the market. The average output is about 1,500 kg, while the national average is about 1,000 kg. Where is the parity,?” he asked.

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Published on July 04, 2018
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