Experts wary as Capt urges PM to raise paddy MSP
NEW DELHI: Punjab chief minister Amarinder Singh has written to Prime Minister Narendra Modi to seek an increase in the minimum support price (MSP) of paddy much higher than the amount approved by the Centre on Wednesday — a demand that experts said could exacerbate the problems surrounding India’s cropping patterns.
The Centre on Wednesday announced new MSPs for the summer-sown or kharif crops. In line with a policy to promote more planting of scarce commodities such as oilseeds and pulses, the new MSP rates are relatively higher for non-cereals, such as lentils, soya, groundnut and mustard.
MSPs are federally fixed floor prices aimed at avoiding distress sale by farmers and signalling a benchmark rate for private traders.
A larger hike in MSP for paddy will give growers more margins for the main summer staple. But it also could further skew cropping patterns, marked by a glut of grains and scarce output of other essential items.
On Thursday, Singh called the latest increase in MSP an “insult to farmers”, and, in his letter, he also cited rising labour costs due to the Covid-19 pandemic.
The Punjab CM has sought an MSP of ₹2,902 a quintal for paddy, nearly 49% more than what the Centre settled at: ₹1,940.
Experts, however, warned of the pitfalls. “If one breaks down the paddy MSP offered by the Centre, you get two parts in it -the basic cost of cultivation and 50% returns over that cost,” said S Mahendra Dev, a former chief of the Commission for Agricultural
Costs and Prices, the federal body under the farm ministry that fixes MSPs. “We don’t want to be swimming in rice and paying dearly for pulses.”
Farm economist KS Mani said the government’s “directional change” towards higher MSPs for non-cereals was in line with a
widely accepted view that “cropping patterns must change”. He said there was “fair legitimacy to the demand for a federal subsidy to stop stubble burning”.
Some economists say Punjab should not be growing paddy at all because of its serious water crisis.