An Analysis of Minimum Support Price (MSP) in India: Challenges, Opportunities, and Recommendations

सार

Minimum Support Price (MSP) is an integral component of Agriculture Price Policy of India. It targets to ensure support price to farmers and affordable price to consumers through public distribution system (PDS). The minimum guaranteed prices are fixed to set a floor below which market prices cannot fall. If no one else buys it, the government will buy the stock at this minimum guaranteed prices. This is what came to be known as the minimum support price or MSP.  This paper examines the Minimum Support Price (MSP) policy in India, its impact on farmers, and the challenges faced in its implementation. We analyze the current MSP regime, identify gaps, and suggest recommendations for improvement.In this paper, we have analysed farmers' awareness about Minimum Support Price (MSP) and its impact on diversification of crops grown in India. We used nationally representative data collected by National Sample Survey Office, 70th round data. The data revealed that only 23.72 and 20.04 per cent of farmers in the rural agricultural households in India are aware of MSP of crops grown by them in kharif and rabi season, respectively.