 "Does Economic Survey hint at what Budget 2024 may have on MSP?")
The 2023-2024 Economic Survey tabled by Finance Minister Nirmala Sitharaman said that the Minimum Support Price (MSP) has “incentivised crop diversification”. The survey elucidated the positive impact of MSP on the overall retail prices of all the crops.
Many believe that the mention of MSP hinted at the kind of approach the government will take towards the agricultural sector. “Promoting crop diversification towards oilseeds, pulses, and horticulture requires addressing critical issues such as investment in agri-infrastructure, credit accessibility and appropriate market institutions,” the survey reads.
“MSP has incentivised crop diversification and there is evidence that MSP has a positive and statistically significant effect on retail prices of all crops, with a stronger effect for those crops where procurement is substantial, such as paddy and wheat.,” it furthered.
With this, the survey suggested that efforts must be made to encourage production patterns and practices in various geographies “that are consistent with their agro-climatic characteristics and natural resources.”
Agriculture can be the growth engine
The Economic Survey focused on the agriculture sector, describing it as “one area ripe for and in need of a pan-India dialogue.”
“Agriculture and farmers matter for a nation. Most countries understand that. India is no exception. India subsidises its water, electricity and fertilisers. The former two are provided virtually free. Their incomes are not taxed,” it says.
Impact Shorts
More ShortsIt is pertinent to note that the government offers a Minimum Support Price (MSP) for 23 selected commodities. Not only this but monthly cash support is offered to farmers through the PM-KISAN scheme.
Hence, the survey stated that a “panoply of policies by national and sub-national governments — working at cross-purposes with each other is hurting farmers’ interests, destroying soil fertility, depleting groundwater, polluting rivers and the environment with nitrous oxide emissions, starving the crops of nutrients and undermining people’s health with a diet rich in sugar and carbohydrates rather than fibre and protein. “
Opposition demands ’legal guarantee’ for MSP
Soon after the economic survey was released, Congress general secretary-in-charge Jairam Ramesh demanded a legal guarantee for MSP.
"India is in its most precarious and difficult economic situation in many years. The Economic Survey 2023-24 might present a cherry-picked view of the economy, but we hope that tomorrow’s Budget faces up to the country’s realities."
— Congress (@INCIndia) July 22, 2024
Here is the statement issued by Shri… pic.twitter.com/OY12akPOv2
“While the UPA had raised the MSP of wheat by 119 per cent and that of rice by 134 per cent, the Modi government has raised it by 47 per cent and 50 per cent respectively. This is not at all enough to keep up with inflation and the rising prices of agricultural inputs,” the Congress leader claimed in a statement on Monday.
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