Why legal guarantee for Minimum Support Price, the other demand of protesting farmers is a lose-lose proposal

Published 2021년 11월 24일

Tridge summary

Indian farmers are continuing their protest against the government, demanding a legal guarantee for Minimum Support Price (MSP) in addition to the proposed repeal of three contentious farm laws. The MSP is the government's safety net for farmers, providing a minimum price for their produce. The government could ensure this legally by setting the MSP as the market baseline or by purchasing all 23 eligible crops itself. However, both options could lead to significant economic implications, including increased costs, market disturbance, and potential harm to the flourishing agriculture export sector. Economists caution that the MSP system, with its fixed prices and government control over input costs, can lead to resource misallocation and market inefficiencies.

Disclaimer:The above summary was generated by Tridge's proprietary AI model for informational purposes.

Original content

New Delhi: Protesting farmers are refusing to return home, even after Prime Minister Narendra Modi has promised to repeal the three contentious farm laws. They have now written to the Prime Minister, stating that they will continue their protest for other demands, chief among them the legal guarantee for Minimum Support Price (MSP). MSP is the minimum price safety net provided by the government to farmers. It is through MSP that the government procures farmer produce to give them a guaranteed price, along with an assured procurement market. As of now, the central government, on recommendation of the Commission for Agricultural Costs & Prices (CACP), declares MSP for 23 crops — paddy, wheat, maize, sorghum, pearl millet, barley, ragi, gram, tur, moong, urad, lentil, groundnut, rapeseed-mustard, soybean, sesamum, sunflower, safflower, niger seed, copra, sugarcane, cotton and raw jute. Without the legal mandate, the government is under no obligation to procure the 23 crops under MSP. ...

Source: Theprint