New Modi government likely to increase MSP by 5-10%: Report

The new government may increase the minimum support price for some crops by 5 to 10%, reported CNBC Awaaz. As per the report, the Commission for Agricultural Costs and Prices (CACP) has sent its suggestions and a decision may be taken in the first cabinet meeting of the new government.

MSP on crops

The MSP increase is likely to be seen for paddy, pulses, oilseeds, and coarse grains. The CNBC Awaaz report further mentioned that the increase in MSP may lead to increased production during the Kharif season.

Minimum Support Price or MSP is the minimum price given to farmers for a crop when it is sold the government or any of its agencies. This assured prices protect farmers from sudden decline in prices. However, an increase in MSP may lead to wholesale and retail price rise of both the crops and the end products where the crops are used.

Maharashtra is witnessing a decline in the sowing of Tur dal in Maharashtra and many are shifting to Soybean. The Soybean production has increased in 3 years.

In the Lok Sabha polls, the electoral support for BJP declined, due to continued rural distress. Meanwhile, the opposition parties had promised legally guranteed prices for farmers.

Also watch: Farmers' 'Delhi Chalo' march begins; here's why farmers want Swaminathan Commission's MSP formula