Quixplained: What is MSP and how is it determined?

What is minimum support price (MSP) for farmers? How is it determined? How effective is it? We explain.

• By: Explained Desk
• New Delhi | October 7, 2020 11:24 AM IST
2 min read

The newly passed farm trade Bill has raised concerns that farmers may no longer be assured MSP for their crop (Image: Pixabay)

Minimum support price (MSP) is a “minimum price” for any crop that the government considers as remunerative for farmers and hence deserving of “support”. It is also the price that government agencies pay whenever they procure the particular crop.

The Centre currently fixes MSPs for 23 farm commodities — 7 cereals (paddy, wheat, maize, bajra, jowar, ragi and barley), 5 pulses (chana, arhar/tur, urad, moong and masur), 7 oilseeds (rapeseed-mustard, groundnut, soyabean, sunflower, sesamum, safflower and nigerseed) and 4 commercial crops (cotton, sugarcane, copra and raw jute).

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What is the Minimum Support Price (MSP) for farmers? Minimum support price (MSP) for farmers: How is it determined? Minimum support price (MSP) for farmers: The Centre fixes MSPs for every kharif and rabi cropping season based on recommendations of the CACP. Minimum support price (MSP) for farmers: It was introduced in the mid-sixties when India was food-deficit. Minimum support price (MSP) for farmers: How effective is it now?

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