Cabinet Committee on Economic Affairs (CCEA) chaired by Prime Minister Narendra Modi has approved the increase in the Minimum Support Prices (MSPs) for all mandated Rabi crops of 2019-20 to be marketed in Rabi Marketing Season (RMS) 2020-21.
For the Rabi crops of RMS 2020-21, the highest increase in MSP has been recommended for lentil (Rs. 325 per quintal) followed by safflower (Rs. 270 per quintal) and gram (Rs. 255 per quintal) which is a major step towards increasing the income of farmers.
The MSP of rapeseed and mustard has been increased by Rs. 225 per quintal. For both wheat and barley, the MSP has been increased by Rs. 85 per quintal. Wheat farmers will hence get a return over cost of 109 percent.
Cost of production is one of the important factors in the determination of MSPs. This year’s increase in MSP of Rabi crops for RMS 2020-21 provides higher than 50 per cent return (except safflower) over all India weighted average cost of production. The return over all India weighted average cost of production is 109 per cent for wheat; 66 per cent for barley; 74 per cent for gram: 76 per cent for lentil; 90% for rapeseed & mustard and 50 per cent for safflower.
MSP (in Rupees) for Rabi Marketing Season 2020-21
| Sl. No | Crops | Cost of production RMS 2020-21 | MSP for RMS 2019-20 | MSP for RMS 2020-21 | Absolute increase in MSP | Return over cost (in per cent) |
| 1 | Wheat | 923 | 1840 | 1925 | 85 | 109 |
| 2 | Barley | 919 | 1440 | 1525 | 85 | 66 |
| 3 | Gram | 2801 | 4620 | 4875 | 255 | 74 |
| 4 | Lentil | 2727 | 4475 | 4800 | 325 | 76 |
| 5 | Rapeseed & Mustard | 2323 | 4200 | 4425 | 225 | 90 |
| 6 | Safflower | 3470 | 4945 | 5215 | 270 | 50 |
In the case of cereals, Food Corporation of India (FCI) and other designated state agencies would continue to provide price support to the farmers. State governments will undertake procurement of coarse grains with the prior approval of the government and would distribute the entire procured quantity under National Food Security Act (NFSA). The subsidy will be provided only for the quantity issued under NFSA. National Agricultural Cooperative Marketing Federation of India (NAFED), Small Farmers’ Agribusiness Consortium (SFAC) and other designated Central agencies would continue to undertake procurement of pulses and oilseeds. The losses, if any incurred by the nodal agencies in such operations may be fully reimbursed by the government as per the guidelines.
