Question

What is minimum support price explain

Answer 1

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• The minimum support price (MSP) is an agricultural product price, set by the Government of India to purchase directly from the farmer.
• This is not enforceable by law.
• By definition, this rate is to safeguard the farmer to a minimum profit for the harvest, if the open market has lesser price than the cost incurred.
• The Indian government sets the price for 23 commodities twice a year.
• MSP is fixed on the recommendations of the Commission for Agricultural Costs and Prices (CACP) since 2009.

Answer 2

Answer:

The Minimum Support Price or the MSP is commonly known as the way of protecting the farmers in India from the uncertainties of the markets as well as those of the natural kind. A ‘safety net’ for the farmers, the MSP is the core of the agricultural revolution that saw India transforming from a food-deficient to a food-surplus nation. Over the years, the MSP has helped the farmers in India to stave off the effects of financial fluctuations. The MSP has become a major talking point after the farmers’ protests reached the national Capital. At FE Knowledge Desk, we deconstruct the concept behind the Minimum Support Price.