MSP, APMC & Procurement
Indian Agriculture · MSP, APMC और खरीद · 18 facts
Minimum Support Price (MSP) is the price at which the government buys crops from farmers to ensure they receive a guaranteed minimum income.
The Commission for Agricultural Costs and Prices (CACP), based in New Delhi, recommends MSP to the Cabinet, which then approves it.
MSP is announced for 23 crops — including cereals (paddy, wheat, maize, jowar, bajra), pulses, oilseeds, and commercial crops (cotton, jute, sugarcane).
The A2+FL formula for MSP calculation includes actual paid-out costs (A2) plus imputed value of family labour (FL).
The C2 formula (comprehensive cost) includes A2+FL plus imputed rental value of land and interest on fixed capital — farmers demand MSP based on C2.
Agricultural Produce Market Committee (APMC) is a state government body that regulates agricultural markets (mandis) — agriculture is a State List subject.
eNAM (National Agriculture Market) — launched in April 2016, it is an online trading portal linking over 1000 APMC mandis across India.
Food Corporation of India (FCI) was established in 1964 under the Food Corporation Act — it handles procurement, storage, and distribution of food grains.
FCI maintains buffer stock of food grains (rice and wheat) to ensure food security and price stabilization in the country.
Cotton Corporation of India (CCI) is the nodal agency for procurement of cotton at MSP; NAFED procures oilseeds and pulses at MSP.
NAFED (National Agricultural Cooperative Marketing Federation of India) was established in 1958 — it promotes cooperative marketing and price support operations.
The Pradhan Mantri Annadata Aay SanraksHan Abhiyan (PM-AASHA) was launched in 2018 to ensure remunerative prices to farmers for their produce.
Price Support Scheme (PSS) under PM-AASHA: government agencies purchase oilseeds, pulses, and copra at MSP when prices fall below MSP.
The Shanta Kumar Committee (2015) recommended reducing MSP operations and restructuring FCI to make it more efficient.
Procurement of paddy at MSP is highest in Punjab, Haryana, and Telangana; wheat procurement is highest in Punjab and Haryana.
Small Farmers Agribusiness Consortium (SFAC) helps small and marginal farmers access markets and promotes Farmer Producer Organisations (FPOs).
Three Farm Laws (2020) were passed to reform agricultural marketing but were repealed in 2021 following farmer protests — they aimed to bypass APMC mandis.
Gramin Agricultural Markets (GrAMs) initiative aims to develop 22,000 rural haats into Gramin Agriculture Markets to give farmers direct access to consumers.