MSP Benefits Study: Who Gains from Paddy and Wheat Procurement
Why in the news
As the Centre and farmers debate a legal MSP guarantee, an ICAR-NIAP study (National Institute of Agricultural Economics and Policy Research) showed how unevenly MSP gains are spread.
Key facts
- Small and marginal farmers, the majority, benefit far less than large ones.
- Gains are tilted towards farmers with larger marketable surpluses.
Advantage of selling at MSP
| Measure | Paddy | Wheat |
|---|---|---|
| Yield higher by | 13.5% | 5% |
| Price edge over open market | 13.2% | 3.5% |
| Total income higher by | 23.2% | 9.6% |
Way forward
- Expand the Price Deficiency Payment Scheme.
- Procure specifically from small and marginal farmers.
- Open MSP access to every farmer category.
Exam angle
- Study by ICAR-NIAP; crops: paddy and wheat.
- Main finding: MSP procurement is skewed towards large farmers.