Minimum Support Prices are decided by:

Question

Question

This question was previously asked in

DSSSB PGT Chemistry (Female) Official Paper (Held On: 06 Jul, 2018 Shift 1)

Answer 1

The correct answer is Cabinet Committee on Economic Affairs.

Key Points

The Cabinet Committee on Economic Affairs (CCEA) is responsible for approving the Minimum Support Prices (MSP) for various crops in India.
MSP is a form of market intervention by the government to ensure agricultural producers are protected against any sharp fall in farm prices.
The CCEA takes decisions based on the recommendations of the Commission for Agricultural Costs and Prices (CACP).
MSP is announced for 22 mandated crops and an additional bonus for some crops in certain cases.
The primary objective of MSP is to ensure a remunerative price to farmers and encourage them to adopt modern farming practices.

Additional Information

Commission for Agricultural Costs and Prices (CACP):
- CACP is an attached office of the Ministry of Agriculture and Farmers' Welfare.
- It recommends MSPs for crops based on factors like cost of production, demand-supply balance, and market price trends.
Factors Considered for MSP:
- Cost of cultivation, including inputs like seeds, fertilizers, and labor.
- Trends in domestic and international market prices.
- Parity between crops and ensuring fair returns to farmers.
Mandated Crops under MSP:
- Includes cereals (wheat, rice, maize, etc.), pulses (tur, moong, urad), oilseeds (soybean, mustard, groundnut), and commercial crops (cotton, sugarcane).
Role of MSP in Agriculture:
- Encourages farmers to grow particular crops to meet food security needs.
- Acts as a safety net for farmers during market price fluctuations.
- Helps stabilize the rural economy and reduce farmer distress.