Minimum Support Price (MSP)

Minimum Support Price (MSP) : Recently, the Cabinet Committee on Economic Affairs (CCEA) approved an increase in the Minimum Support Price (MSP) for 14 major Kharif crops for the 2025–26 marketing season.

o This move aims to ensure remunerative returns to farmers and upholds the government’s commitment to maintaining MSP at 1.5 times the cost of production.

• About MSP: The minimum price set by the government aims to ensure farmers receive a fair value for their crops, even if market prices fall.

  o Introduced during the Green Revolution in 1966-67 as part of agricultural reforms.

  o Acts as a safety net to protect farmers from financial losses and helps maintain food security.

  o Announced twice a year, before the Kharif (monsoon) and Rabi (winter) sowing seasons.

  o The Commission for Agricultural Costs and Prices (CACP) recommends MSP, which is then approved by the Cabinet Committee on Economic Affairs (CCEA).

  • Need for MSP: Guarantees a minimum income for farmers, shielding them from financial losses.

  o Provides assured prices, motivating farmers to produce staple crops and support food security.

  o Acts as a buffer against price fluctuations, especially during the harvest season.

  o Supports a strong agricultural sector, uplifting rural livelihoods and boosting the overall economy.

  o Protects farmers from being compelled to sell their produce at unfair prices to traders.