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Is the practice of announcing Minimum Support Price (MSP) going to die? The practice to announce MSPs for certain crops to protect the basic interests of farmers may become extinct, an expert says.
T Haque, former Chairman of Commission for Agricultural Costs and Prices (CACP), suspects that a new situation was being emerging where they might do away with the practice.
Addressing the two-day national consultation on agrarian crisis here on Thursday, he said that the method of calculating the MSP was the main culprit (for the unremunerative compensation to the farmers). The average MSP that comes out of data from several States might be lower than the cost of production in some States.
Annually, the Government announces MSP on a few crops based on the recommendations by the CACP. The Commission gathers information through the States’ agricultural departments to ascertain the cost of production and comes out with its recommendation.
Farmers’ leaders for long are demanding that the MSPs announced by the Government are far too low and don’t even cover the costs. Prominent agricultural scientist M S Swaminathan had recommended to the Congress Government that the farmers must get an MSP on the formula of cost of production plus 50 per cent.
“The Government has given in writing to the court that it is not feasible to give MSP based on the Swaminathan recommendations,” he said.
The meeting is being jointly held by National Institute of Rural Development (NIRD) and Centre for Sustainable Agriculture at the institute’s Rajendranagar facility.
“Also, they consider the interest rate offered by the banks and not the realistic rates at which the farmers take loan from private lenders. They also don’t consider realistic rental values and don’t factor in family labour that goes into the field,” Haque, who is now heading the Delhi-based Council for Social Development, said.
“Governments are not sensitive to the demands of farmers,” he said.
He felt that India, which is witnessing a serious agrarian crisis, needed smart villages and not smart cities. “Urban areas are already at a level of development. What we need is to empower villages. We need smart villages,” he pointed out.
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