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Minimum support price for paddy raised

Special Correspondent

CACP recommendation of Rs. 1,000 a quintal referred to Economic Advisory Council



CACP recommendations to be referred to Economic Advisory Committee

As regards MSP for other kharif crops, the EAC will review the CACP report



NEW DELHI: The Centre on Thursday raised the minimum support price for the common variety of paddy to Rs. 850 a quintal from Rs. 745 and for Grade A to Rs. 875 from Rs. 775 as an “ad hoc measure.” It referred the recommendation of the Commission for Agriculture Costs and Prices to raise the price to Rs 1,000 a quintal to the Economic Advisory Council of the Prime Minister.

Varying opinions

Announcing the decision here, Finance Minister P. Chidambaram said the CACP, chaired by Prime Minister Manmohan Singh, discussed the issue and decided to refer the matter to the EAC headed by C. Rangarajan as varying opinions had been received from various States. Sources, however, said the decision was prompted by rising inflation and the burgeoning food subsidy bill as the central issue price of food grains in the Public Distribution System has remained untouched since 2002.

States’ demand

Several States and political parties had demanded that the MSP of paddy be fixed on a par with rabi wheat, which is Rs. 1,000 a quintal. It was after much hue and cry that the government gave a bonus of Rs. 100 a quintal to take the MSP for common paddy to Rs. 745 and for Grade A to Rs. 775. Against this background, it was expected that the CCEA would go along with the CACP recommendation — backed by the Agriculture Ministry — to raise the MSP of common variety to Rs. 1,000 and of Grade A variety to Rs. 1,050.

Mr. Chidambaram said that while some States wanted the MSP of paddy increased beyond Rs. 1,000, some others wanted it be fixed at a lower rate. Goa wanted it set at Rs. 900, while Gujarat, Madhya Pradesh and Orissa wanted it fixed at Rs. 850. Chhattisgarh, a major rice producing State, wanted it set at Rs. 745, while Himachal Pradesh preferred it to be Rs. 645.

To a question on the views of the Left-ruled Kerala and West Bengal, he said there was no input from the two governments. Tamil Nadu also did not give any view.

As regards the MSP for other kharif crops, he said the EAC would review the report of the CACP, including its recommendations for the other kharif crops as it had certain aspects that needed to be reviewed by the experts’ body. “There is no urgency for announcing the MSP for the other crops as the market prices are already ruling high for them.”

Mr. Chidambaram said the MSP for the common variety of paddy was increased by Rs. 60 a quintal from 1999-2000 to 2003-04, while it was raised by Rs. 195 during 2003-04 to 2007-08. “Farmers have been given good prices, which were reflected in production and procurement ... but a Rs. 255 hike would be very sharp rise,” he said.

He denied that it was the first time the government had not accepted the recommendations of the CACP. The recommendations had been modified in the past, he said.

BJP refutes claim

The Bharatiya Janata Party (BJP) refuted the claim of Mr. Chidambaram that the BJP-ruled States had demanded a lower MSP for paddy. Party spokesman Prakash Javdekar told reporters here that Chhattisgarh Chief Minister Raman Singh had in fact demanded Rs. 1,000 a quintal for paddy and sent his recommendation to the Centre along with 10 lakh signatures.

He said that anything less than Rs. 1,000 for paddy would be “gross injustice” to farmers.

Normally the other crops for which the government should have announced the minimum support price for the 2008 kharif season are jowar, bajra, maize, ragi, tur (arhar), urad, groundnut, soyabean, sunflower seed, sesamum, niger seed and cotton. The CACP has recommended a raise at between 25.8 and 94 per cent for these commodities.

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