People's Democracy

(Weekly Organ of the Communist Party of India (Marxist)


No. 01

January 06, 2013




Wheat MSP Hike: Mockery of Farmer’s Plight


THE All India Kisan Sabha (AIKS) has strongly condemned the insensitive decision of the Congress-led UPA government to only marginally increase the minimum support price (MSP) of wheat to Rs 1350 per quintal. The AIKS had demanded not less than Rs 1800 per quintal for wheat, taking into account the increased costs of production due to the rising input costs. The weighted MSP recommended by states was, on the other hand, Rs 1868 per quintal.


Through a statement issued from New Delhi on December 27, 2012, the AIKS pointed out that the increase recommended by the Cabinet Committee on Economic Affairs (CCEA) is only five per cent above the last year’s MSP. In the same period, however, there has been a manifold increase in the prices of fertilisers, irrigation costs and the prices of other inputs. Fertiliser prices have risen by around 50 per cent, diesel prices by over 45 per cent and also labour costs by at least 20 per cent. These, the AIKS accused, have not been factored in while determining the MSP. The statement also said the decision after an undue delay and after more than two months into the rabi sowing season is not going to incentivise the wheat farmers.


The Commission for Agricultural Costs and Prices (CACP) and the government are making a mockery of the plight of farmers by acting in tandem --- with the former first seeking a freeze on the MSP and the latter announcing a marginal increase by apparently turning down the proposal and seeking to portray itself as farmer-friendly. Notably, the CACP, in its price policy for rabi crops for marketing season 2012-13, had recommended Rs 1350 per quintal, based on the rising costs of cultivation, and the government had, at that time, announced an MSP of Rs 1285 per quintal. A full 12 months after that, however, the CACP called for freezing the prices at Rs 1285 per quintal for the marketing season 2013-14. The government has now accepted the CACP’s recommendation originally made for 2012-13.


Already, the recommendation of the CACP to freeze the MSP at the last year’s rate of Rs 1285 per quintal and the undue delay by the government in announcing the MSP has had an adverse impact on the area sown, which is lower than what it was for the corresponding period last year. Only 25.3 million hectares of wheat have been sown this year compared to 25.7 million hectares in the same period last year. The low MSP will now, the AIKS warned, lead to a further drop in area under wheat in the coming days.


The CACP recommendation of “liquidating” the stocks to “create space for the new harvest” has been accepted by the government which has allowed an additional export of 2.5 million tonnes. This will bring the total quantity of export from government stock to 4.5 million tonnes. But this move comes at a time when millions of the poor in India are living in a situation of extreme hunger and malnutrition.


In view of all these factors, the AIKS has demanded immediate withdrawal of this retrograde decision and effect a suitable increase in the wheat MSP. It has also asked the government to distribute wheat through the public distribution system, instead of going in for more exports.


The AIKS has also called upon all its units to organise protests against the betrayal of wheat farmers by the government and resist the retrograde announcement.