Over the period the many other crops as well found there place under this safe MSP blanket. At present there are in total 25 crops under this scheme and the government announces the MSP at the beginning of every season that is Kharif and Rabi crop. .
Kharif crop: Paddy, Jowar, Bajara, Maize, Ragi, Arhar, Moong, Urad, Cotton, Groundnut, Sunflower seed, Soybean black, Sesamum, Nigerseed.
Rabi Crops: Wheat, Barley, Gram, Masur, Rapeseed/ Mustard, Safflower and Tori.
Other crops: Copra, Jute, Sugarcane and De-husked Coconut .
Rationale Behind MSP.
In case of unforeseen events like a heavy rainfall, there might be a situation where there is abundance of crops in the market. This may lead to a fall in the prices thereby giving rise to a state of market which is not in equilibrium i.e. there is a mismatch between the quantity demanded and supplied, which in-turn pushes the prices to go down. To safeguard the interest of the farmers in such situations the government intervenes and procures the excessive supply from the market in order to restore equilibrium and prevent the price from falling below the MSP. .
How MSP is Decided.
The government fixes the MSP for all the above mentioned commodities after taking into consideration the following:.
Recommendations of Commission for Agricultural Costs and Prices.
Views of Ministries.
Views of State Government.
Other relevant factors.
Applications of MSP in Paddy.
MSP is the rationale used by the government in order to counter the inordinate drop in prices of food crops especially the kharif and the Rabi crops. MSP was started. MSP as a policy measure was used by the government of India during the wake of the green revolution in order to protect farmers and provide them with enough funds so that their production of crops isn't affected by dwindling prices and scarcity. The ideas were also extended to protect the consumers from hoarding and price wars during times of scarcity.
