NEW DELHI: As different states have come out with various schemes to protect farmers from price volatility, the Centre has expressed its willingness to support them all within the existing schemes and may even spend more in 2018-19 to procure agricultural and horticultural commodities at remunerative prices.
“We will not reject states’ requests. We would like states to procure as much as required to reduce farmers’ pain and we are willing to share the financial burden under the existing Price Support Scheme (PSS) and Market Intervention Scheme (MIS),” said Union agriculture minister Radha Mohan Singh.
He told TOI that the Centre has, in fact, been encouraging states to procure even those farm produce at remunerative prices which are not covered under the minimum support price (MSP). “Record amount spent by the Centre under both PSS and MIS during 2014-15 to 2017-18 is the testimony of our commitment,” said Singh.
Under PSS, the procurement of oil-seeds, pulses and cotton is undertaken through central nodal agencies at MSP. On the other hand, the Centre implements MIS for procurement of agricultural and horticultural commodities which are perishable in nature and are not covered under the PSS. The scheme is implemented at the request of state government which is ready to bear 50% of the loss (25% in case of north-eastern states), if any, incurred on its implementation.
Flagging the ministry’s data, Singh noted that the government had procured pulses, oil-seeds and cotton worth Rs 42,970 crore from 2014-15 to 2017-18 (till January 27) as compared to these produce worth Rs 8,310 crore from 2011-12 to 2013-14.
Similarly, the government has sanctioned Rs 3,027 crore for procuring perishable farm produce under MIS during 2014-15 and 2017-18 (July-June crop year) as compared to Rs 1,333 crore between 2011-12 to 2013-14.
The Centre has been keenly observing states’ schemes like the one in Madhya Pradesh (Bhavantar Bhugtan Yojana), Telangana (cash support to farmers to cover input costs), Haryana (Bhavantar Bharpai Yojana for four select vegetables) and the proposed one from Maharashtra where the state is exploring the option of having its own MSP as Centre’s MSP does not reflect regional realities and cost of cultivation.
Though the MP’s scheme has drawn a lot of attention and positive feedback, the Centre’s focus will continue to be on market reforms through e-NAM and amendment in the APMC law and bringing legislation on contract farming to ensure remunerative prices to farmers. Officials in the ministry think the state-specific schemes are just a short-term solution.
“These schemes are needed because the states failed to procure crops on MSPs. If they strengthen their procurement mechanism, the existing systems including PSS and MIS have potential to address farmers’ woes on price front,” said an official.
Under the MP’s ‘Bhavantar Bhugtan Yojana’, state government pays farmers the difference between MSP for crops and their average market rates. Farmers get money if they have to sell their produce in open market below MSP. In Haryana, on the other hand, the state government fixes protected price for potatoes, onion, cauliflower and tomatoes. If prices of these vegetables fall below the protected price, farmers will be compensated for the deficit.
Telangana has, however, a different approach to support farmers. The state will disburse Rs 4,000 per acre twice a year (Kharif and Rabi) to cover costs of major inputs (fertilisers, seeds and pesticides). Disbursement under this cash support scheme will start from Kharif season this year (May). It’ll cost Rs 12,000 crore per year to the state exchequer.
(With input from Rajendra Sharma & Ankur Sirothia in Bhopal and Krishna Prasad in Hyderabad)