MSP gap of crops rising

Written by ASHOK B SHARMA | New Delhi, Sep 20 | Updated: Sep 21 2007, 05:10am hrs
The government is planning to increase the minimum support price (MSP) for paddy by formulating an additional bonus price for procurement.

The MSP for paddy has not increased significantly since 2002 to keep up with that of wheat. This has resulted in the widening of the gap between the MSPs of two staple cropswheat and rice.

The MSP for common variety paddy for 2007-08 is Rs 645 a quintal while that of Grade A variety paddy is Rs 675 a quintal. The Commission for Agricultural Costs and Prices (CACP) has computed the wheat MSP for the current season at Rs 1000 a quintal. At this level the difference between the MSPs for wheat and common variety paddy works out to Rs 355 a quintal. The gap between the MSPs for wheat and Grade A variety paddy is also wide at Rs 325 a quintal.

The ideal gap between the MSPs for wheat and paddy should be in the range of about Rs 100 . This situation was in 2002-03 when the MSP for common variety paddy was Rs 530 a quintal, that of Grade A variety at Rs 560 a quintal and that of wheat at Rs 620 a quintal, said Union agriculture secretary PK Mishra.

Farmers are, however not happy over the CACPs recommendation of hiking the MSP for wheat from Rs 850 a quintal (effective price with bonus) to Rs 1000 a quintal. The wheat MSP should be raised in the range of Rs 1200 to Rs 1500 a quintal. The government is already paying over Rs 1,567 a quintal on an average for the landed cost of imported wheat. Why cant it not pay that much amount to farmers, said Krishan Bir Chaudhary, president of Bharatiya Krishak Samaj.

Chaudhary, however said that the gap between the MSPs for wheat and paddy needs to be narrowed down to Rs 100 per quintal. He said that paddy cultivation entails higher costs which includes transplantation.

However some agriculture economists are of the view that parity should be worked out between the MSP for wheat and milled rice and not with paddy as this would be in the interests of consumers.