MSP Bill: Farmers Still unhappy On Kisan Diwas

Kisan Diwas is being observed all over the country today. With the farmers sitting in agitation over MSP Bill, the significance of the day increases this year. How can we leave our ‘annadatas’ agitated, especially on their special day? 

The farmers are mainly concerned about their much-loved MSP system. ‘Give MSP or give resignation’ is the slogan raised by many. Although, MSP was never a part of any Indian law and is in effect as part of government policy only. The farmers now want that it should be duly protected through laws. Verbal assurances by the government do not satiate the farmers anymore.

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Some analysts have started calling the MSP system opium for farmers. It has become an addiction, but it is also deteriorating their farm health. In this article, we analyze if there is any truth in the statement.

What is MSP?

In any industry that you work for, every employee is guaranteed a minimum wage. It is a bare minimum price below which the employee should not work. MSP or a minimum support price is a similar minimum price for the work of farmers. There are 23 crops in India for which MSP is announced. MSP is the same throughout the country.

The MS Swaminathan Committee in 2006 recommended fixing MSP at least 50% more than the weighted average cost of production. The Shanta Kumar Committee in 2015 recommended the same. This provision has still not been implemented. 

Is MSP good for farmers?

The government with every MSP announcement hopes to end all farmer woes. The farmer suicides continue at the same pace. Why is the magic wand not working?

MSP as a fallback price is definitely good for the farmers if set keeping political considerations aside. Soil conditions and market needs need to be taken into consideration first. A single price for the entire country can never be right. When the wage rates are different across the states, how can the cost of production be the same? If the cost of production is different, how would a uniform selling price suffice?

Another major and the foremost concern is that MSP is not reaching the rightful farmers. Only about 6% of farmers actually sell at MSP according to the 2015 Shanta Kumar Committee Report. This 6% of farmers are the rich farmers with access to government ‘mandis’. The remaining 94% of small and marginal farmers are left at the mercy of prices set by intermediaries.

There is another sad fact that came out with a NITI Ayog study. Only 10% of the farmers are aware of the right price that they will get before the sowing. Many are totally unaware of the MSPs.

Why is MSP called opium for farmers then?

MSP creates artificial prices. Rather than improving productivity and market linkages, it distorts the agricultural market. Farmers ask for higher MSPs and government raises it. Liberal MSPs for a few crops shrink the crop sowing choice for farmers. This is evident from the Punjab-Haryana belt. 

The region is on the verge of desertification. It is still the highest producer for water-intensive crops like paddy and wheat. The water level in the region is alarmingly low. The credit goes to the year on year paddy production by farmers. Paddy is a water-intensive crop. Some 2800 liters of water is used in producing merely a kilogram of rice! 

msp bill

Government subsidies on water and power consumption have artificially created water in the dry belt. People have private tubewells that suck groundwater. Statistics show that 88.11% of Punjab’s districts and 76.02% of Haryana’s are drought-resilient. This has been possible because of misplaced government subsidies. With this water, farmers grow water-intensive crops for which higher MSP is announced every year. The desert state is now exporting water with its crops. But how long can these artificial things last? With the current unsustainable use of groundwater and unthoughtful MSP announcements, the day is not far that kids will be crying for a glass of water in Punjab.

Where does the problem lie? How do we tackle it?

The problem clearly lies in inefficient MSP Bill announcements which are mostly politically motivated. The problem also lies in a single MSP being set for all the states despite very different soil conditions. 

If the government is really serious in its efforts to double farm incomes by 2022, it needs to rethink its MSP Bill. Only the corporatization of agriculture will not help the farmers, a revamped MSP regime is a need for the hour.

In a country, where every day, 28 farmers die by suicide, it is very important to understand and work towards farmer needs. After all, our food and our very existence is dependent on them.

Also Read: Are the Farm Protests Real or Fake?

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