Syllabus: GS-III
Subject: Economy
Topic: Agriculture and Allied Sector
Issue: Minimum Support Price
Benefit of giving legal status to MSP:
- Total value of 23 MSP crops for 2023-24 is approximately Rs 15 lakh crore, but only about Rs 10 lakh crore actually reaches markets due to various factors.
- Government purchase, including sugarcane, amounts to about Rs 4-5 lakh crore,
- While the private sector buys only Rs 5-6 lakh crore worth of MSP crops, on average 25% below MSP.
- Legal status for MSP could potentially increase private sector payments by up to Rs 1.5 lakh crore annually,
- This will lead to economic benefits through increased demand, employment, and investment.
- Legal MSP would promote crop diversification, reduce fiscal burden on government, and contribute to self-sufficiency in edible oils and pulses.
- Farmers seek enforcement of MSP only for willing market participants, similar to other regulated sectors like sugarcane and minimum wages.
- Legal MSP will ensure that farmers remain solvent and protects food security.
