The minimum support price on agri crops should continue as long as markets become competitive and efficient, but it should be given through means other than procurement, government think-tank Niti Aayog member Ramesh Chand said on Wednesday.
Chand -- while addressing a conference on ‘Getting agriculture markets right’ -- organised jointly by National Stock Exchange and ICRIER -- said: “Deficiency Pricing Payment (DPP)’ is one such means of giving MSP (Minimum Support Price) to farmers, but cautioned that DPP cannot be stopped once implemented.
Under DPP, the difference between the open market price and MSP is given to farmers, he said, adding that it has been implemented in some states like Madhya Pradesh.
MSP is a minimum price at which the government undertakes procurement. MSP is fixed for 22-23 crops. Rice and wheat are largely procured crops by the government.
“In some cases, MSP is justified in times of volatility in prices and glut. I feel what matters is how we give MSP to farmers. ...MSP has to be there as long as markets are not competitive and efficient.