The central government’s decision to increase the minimum support price (MSP) for pulses for the upcoming kharif season of 2016-17 has failed to excite traders and farmers from Latur, the heartland of pulses in the country. This rise in MSP, they say, is too little to maintain a permanent increase in areas under pulse cultivation in the country.
On Wednesday, the central government announced the MSP for 15 agricultural commodities. As per the newly declared prices, the MSP for Tur was increased to Rs 5,050 per quintal from the present Rs 4,625 per quintal, an increase of 9.2 per cent. Similarly, the prices of other pulses like moong and urad were increased by 7.7 per cent and 8.1 per cent to Rs 5,225 and Rs 5,000 per quintal respectively.
Incidentally, the increase in the price of pulses was the highest among all the commodities. Pulses, especially tur, has been in news over the last year or so due to the sharp price hike, both wholesale and retail. Decrease in area of cultivation due to drought and low profitability have been cited as the main reasons for the price hike.
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In order to arrest any further price hike, both the state and central government have taken various measures to increase the area of cultivation of pulses. The increased MSP is one such measure, which the government hopes will make farmers prefer pulses over other crops. Modal prices of tur in the wholesale market of Latur are at present hovering in the range of Rs 8,500- 9,000 per quintal. Latur’s wholesale market is the price setter for pulses across the country.
India imports around 15-20 per cent of its requirement of pulses annually. Lalit Shah, chairman of the Latur market committee, said the MSP hike would not have any immediate effect as the market prices are already too high. “If the rains are good, farmers will prefer tur and other pulses, given the good prices. However, in case of a good crop, prices are bound to fall next year, which will again see a decrease in area for the next year,” he said. Shah said if the MSP was fixed at Rs 7,000 per quintal, it would be profitable for the farmers and there would be a permanent solution to the problem.
Nitin Kalantari, CEO of Kalantary Food, one of India’s largest importer and exporter of pulses, is of the similar view. “If the MSP was made between Rs 6,000-7,000, a real strong signal would have gone to the farming community,” he said. In order to ensure permanent increase in pulses area, Kalantari also said the government should continue to procure at market price to create a buffer stock. This year, in the face of the high prices, the central government had procured five lakh bags of pulses, with procurement happening at current market prices.