Data | Farmers, new agriculture laws and government procurement

Data | Even in States with limited procurement, farmers wanted MSP programme to continue

Farmers block railway tracks during the ongoing 'Rail Roko' protest over the farm reform bills, at Devi Dass Pura village in Amritsar, Punjab on October 7, 2020.   | Photo Credit: PTI

Only 6% of agricultural households in India sell* their produce at the Minimum Support Price (MSP), latest available data show. Then, why has MSP become a contentious issue? Two surveys show that even in States where there was limited procurement, farmers wanted the MSP programme to continue.

In fact, banning intermediaries, a key promise of the new farm laws, was not among the chief concerns of the farmers. The protests have spilled over to States such as Karnataka, Rajasthan and Tamil Nadu where procurement was relatively lower than in Haryana and Punjab. This shows that farmers fear that the laws pose an indirect threat to the MSP programme, regardless of procurement levels.

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Farmer feedback

In a 2018 RBI survey, >50% farmers identified "MSPs for crops" as the most helpful scheme. Also, farmers prioritised reliable weather forecasts and storage facility as measures that may help in price realisation over the middlemen issue.

Govt. schemes helping farmers (% respondents)

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Measures that may help in right cropping decision/better price realisation (% respondents)

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Also read: Data | Farm Act wants farmers to sell outside mandis, but most already do so

Uses of MSP

In a Niti Aayog study (FY08-FY11), even in States where awareness about the MSP and sale to procurement agencies were poor, an overwhelming share of farmers wanted the programme to continue. Apart from procurement, the MSP helped farmers escape exploitation even when they sold their produce to private traders.

State-wise split

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