MSP hike an eyewash, Centre's claim misleading, say Agriculture experts

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Agriculture experts and activists from Maharashtra have criticised the Centre for its "false and misleading" claim that the MSP of kharif crops has been hiked by 50 per cent.

According to them, the government first reduced the input costs of supplements required for farming and then increased the MSP. They also said that the Centre considered all the input costs lower than what they were in the previous financial year, before raising the MSP.

The decision to hike the MSP of 14 kharif (summer-sown) crops, including paddy, cotton, and pulses, was recently taken by the Cabinet Committee on Economic Affairs (CCEA) meeting chaired by Prime Minister Narendra Modi.

The MSP for eligible crops is announced by the Commission for Agricultural Costs and Prices (CACP). It has three different definitions of production costs- A2 (actual paid out cost), A2+FL (actual paid out cost-plus imputed value of family labour) and C2 (comprehensive cost including imputed rent and interest on owned land and capital). It means price as per the C2 formula is the highest, while as per A2 is the lowest.

"For instance, the MSP for paddy in 2017-18 was Rs 1,117 per quintal as per the (A2+FL) definition, as against Rs 1,484 per quintal as per C2. Now, the Centre has shown the production cost at Rs 1,166 per quintal for the year 2018-19. How is it possible that the production cost is lower than last year's Rs 1,484 per quintal?" farmer leader Dr. Ajit Navale asked.

"That is why we call it an eye-wash. The government first reduced the input costs of supplements required for farming and then increased the MSP by 50 percent. Farmers are not going to benefit from this for sure," he said.

Navale was one of the leaders who had led last year's state-wide protest of farmers. Following the stir, the Devendra Fadnavis-led Maharashtra government had announced a farm loan waiver scheme. Ramesh Jadhav, an agriculture expert said, "In a recent video conference with some farmers in the county, Modi had assured that MSP will be decided as per the comprehensive production cost (C2). But the reality is that the Centre used A2+FL formula. Had it used the C2 formula to calculate farmers' product cost and then announced MSP it would have been of some help."

As per the Agricultural Costs and Prices, the production costs of the 14 crops for 2018-19, such as paddy, soyabean, cotton, tur, moong, udid, sweet sorghum (jowar), bajra, ragi, corn, groundnuts, and sunflower, were shown less than that of the production cost of 2017-18, he said.

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