New Delhi: At a time when the nation is battling drought and four states are preparing for assembly elections, the Union cabinet on Thursday increased the minimum support price, or MSP, that will be paid to farmers for government procurement of rice and pulses.
The increase is in the range of Rs100 per quintal for rice and up to Rs240 per quintal for pulses. The enhanced MSP could also ensure the availability of foodgrain stock in the face of concerns over drought.
Maharashtra, Haryana and Arunachal Pradesh—all three governed by the ruling Congress party—and Jharkhand, which is under President’s rule, are due to hold assembly elections soon. The autonomous Election Commission is expected to announce poll dates by next month.
The decision to increase the MSP of various grades of rice and different pulses was taken at a meeting of the Cabinet Committee on Economic Affairs. “We are offering an attractive MSP. It (drought) is an evolving situation. The government will respond,” home minister P. Chidambaram told reporters after the meeting.
The support price for common rice paddy will now be Rs950 per quintal, while the A-grade variety would get Rs980 per quintal—an increase of Rs100 a quintal for both.
The MSP for toor dal was raised to Rs2,300 from Rs2,000, that for moong to Rs2,760 from Rs2,520 and sesame to Rs2,850 from Rs2,750 per quintal. Agriculture minister Sharad Pawar said on Wednesday that half the country was reeling under drought and this could cause rice production to decline by 10 million tonnes (mt) in this kharif, or summer crop, season. The country produced 99.15mt of rice in 2008-09, including 84.58 mt in the last kharif season.
The Cabinet also approved an easing of the Debt Consolidation and Relief Facility guidelines to enable states to borrow up to 4% of State Domestic Product during 2009-10. The Cabinet Committee on Infrastructure approved the development of four multi purpose cargo berths at Kandla Port Trust in Gujarat at an estimated cost of Rs755.50 crore.
PTI contributed to this story