MSP(Minimum Support Price) AND PROCUREMENT

What is The Procurement Regime in INDIA ?

• It plays a role to guide the cropping patterns and incentivize production,whereas MSP serves as a Procurement Price and is used as a market price benchmark.
• There are 23 commodities which are notified by Goverment of India,which includes:-

1. 14 kharif,
2. 7 rabi,
3. 2 calendar year season crops.

• Apart from These 23 crops,Government also notifies Fair and Remunerative Prices (FRP) for sugarcane and jute.
• Commission for Agricultural Costs and Prices (CACP) is an independent body which gives recommendation over MSPs to Government.

CROPS UNDER MSP:-

The existing procurement mechanisms by the government are implemented under:

• Price Support Scheme (PSS): Applicable in case of MSP notified crops.

• Market Intervention Scheme (MIS): To support commodities, for which MSPs are not notified - fruits/vegetables/other horticultural products.

• Price Stabilization Fund (PSF): A scheme to protect consumers from rising prices.

• Food Corporation of India operations for Central Pool: Wheat and Paddy is procured to meet buffer norms and for meeting targets of the public distribution system

PM-AASHA:-

Pradhan Mantri Annadata Aay SanraksHan Abhiyan (PM-AASHA) is an An umbrella scheme initiated to further ensure benchmark prices to the farmers for their produce.Key components include:

• Price Support Scheme (PSS): In Price Support Scheme PSS, physical procurement of pulses, oilseeds and Copra will be done by Central Nodal Agencies with proactive role of State governments.
• Price Deficiency Payment Scheme (PDPS): Under PDPS, direct payment of the difference between the MSP and the selling/modal price will be made to pre-registered farmers selling his produce in the notified market yard through a transparent auction process. All payment will be done directly into registered bank account of the farmer. This scheme does not involve any physical procurement of crops.
• Pilot of Private Procurement & Stockist Scheme (PPPS): In addition to PDPS, it has been decided that for oilseeds, states have the option to roll out Private Procurement Stockist Scheme (PPSS) on pilot basis in selected district/APMC(s) of district involving the participation of private stockist.