One of the prime reasons for the agricultural distress in our country is that the farmers fail to get fair remunerative prices on their agricultural produce. The Central Government announced an increase of Rs 200 in the MSP of paddy (common variety) which now would be Rs 1,750/quintal. The decision to increase Rs 200 is a welcome one but that is not commensurate with the rising costs of inputs.
Taking into account the suggestions of Commission for Agriculture Costs and Prices (CACP) regarding the cost of production of paddy for the year 2017-18, if it is computed according to the C2 formula(Swaminathan Commission) it comes to Rs 1,484 per quintal and hence the MSP should have been Rs 2,226 per quintal(1.5 times the cost of production).
However, given the vast size of our country with enormous geographical variations, one size will not fit all and a State-specific approach has to be taken. Same applies to the issue of MSP too. According to the Odisha’s Agriculture and Farmers’ Welfare Department, the average production cost of a quintal of the paddy comes to Rs 2,344. Going by the Swaminathan Commission recommendation that the MSP should be at par with 1.5 times the cost of production, it should have been fixed at least Rs 2930 per quintal as was unanimously passed by the State Assembly. A decision to that effect would have ensured that the farmers of the State get a fair remunerative price on their agricultural produce.
