The PM-AASHA procurement scheme, announced with great fanfare last month as a means to ensure that farmers actually receive minimum support prices for their crops, will not make any difference to farmers in the current season, Agriculture Ministry officials admit.
In the mandis, cereals, pulses and oilseeds are now selling well below MSP, in some cases barely above production costs. The All India Kisan Sangharsh Coordination Committee has calculated a total loss of Rs. 1150 crore to farmers in the first three weeks of the season due to the government’s failure to ensure that crops are sold at MSP.
The Cabinet cleared the Pradhan Mantri Annadata Aay Sanrakshan Abhiyan (PM-AASHA) or PM’s Farmers Income Protection Drive on September 12, saying it reflected the government’s commitment to ensure remunerative prices to farmers for their produce as announced in the Union Budget for 2018.
The umbrella policy clubbed together an existing government procurement scheme with newly introduced options -- meant for oilseeds only -- of additional procurement by private traders or a cash payment scheme. The Centre budgeted Rs. 15,053 crore over two years to implement the scheme apart from an additional government credit guarantee of Rs. 16,550 crore for agencies undertaking procurement.
Six weeks later, senior Agriculture Ministry officials admit that the scheme will make no difference to the plight of farmers on the ground this season, and will not improve their chances of getting MSP for their crops.
“Only Madhya Pradesh has opted for the cash payment component. No other state has readied the IT infrastructure needed to implement it,” a senior official told The Hindu, acknowledging that MP had already been implementing a cash payment using State funds. “The only difference is they can now use Central funds up to 25%, but that will not change anything for the farmer.”
With regard to the private stockists scheme, guidelines were issued to states last week. “It will probably take states and private players about six months…We do not expect any takers in the current season,” said the official.
“When the market price is more than 15% below MSP [which is the margin the Centre has offered to reimburse, why will any traders step in? They are not fools,” said Yogendra Yadav, president of Swaraj India and a member of the AIKSCC. “The government took seven months to decide on [PM-AASHA]. Now it’s a non-starter.”
Using data from the government’s Agmarknet website tracking prices at all major mandis across the country, AIKSCC found that prices for moong, tur and urad dal were barely above the cost of production as calculated by paid out costs and the imputed cost of family labour. All major protected commodies, including those three pulses, oilseeds such as groundnut and soyabean, and cereals such as bajra, jowar and maize are currently selling below MSP.
Multiplying the losses – the difference between MSP and modal prices in the mandis – with the quantity of arrivals in the first 24 days of October, AIKSCC calculated that farmers have absorbed a total loss of Rs. 1149 crore due to the government’s failure to ensure MSP rates for their produce.
