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Center hikes MSP for rabi crops for '25-26, wheat sees 6% rise

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Center hikes MSP for rabi crops for '25-26, wheat sees 6% rise

  • The Union government Wednesday announced minimum support prices (MSP) for six rabi crops for the 2025-26 rabi marketing season (RMS), with wheat — the country’s second-largest crop — seeing an increase of `150 per quintal, or 6.59 per cent, over its current MSP.

Highlights:

  • The Union government has announced the Minimum Support Prices (MSP) for six key rabi crops for the 2025-26 marketing season. The MSP for wheat, one of the largest crops in India, has been increased by ₹150 per quintal, marking a 6.59% hike over the previous year. This brings the new MSP for wheat to ₹2,425 per quintal. Other rabi crops, including barley, gram, lentil (masur), rapeseed, mustard, and safflower, have also seen price hikes ranging between 2.41% and 7.03%.

Crop-Wise MSP Hikes

Wheat:

  • New MSP: ₹2,425 per quintal
  • Increase: ₹150 (6.59%)
  • Wheat is the second-largest crop in India by area, with 318.33 lakh hectares under cultivation and an estimated production of 113.92 million tonnes in 2023-24.
  • Top wheat-producing states: Uttar Pradesh, Madhya Pradesh, Punjab, Haryana, Rajasthan, Bihar, Gujarat, and Maharashtra.

Barley:

  • New MSP: ₹1,980 per quintal
  • Increase: ₹130 (7.03%)
  • Top barley-producing states: Uttar Pradesh, Rajasthan, Madhya Pradesh, Haryana, Himachal Pradesh.

Gram (Chickpea):

  • New MSP: ₹5,650 per quintal
  • Increase: ₹210 (3.86%)
  • Gram is India’s largest pulse crop, with 95.87 lakh hectares under cultivation and production of 11.03 million tonnes in 2023-24.
  • Top gram-producing states: Maharashtra, Madhya Pradesh, Rajasthan.

Lentil (Masur):

  • New MSP: ₹6,700 per quintal
  • Increase: ₹275
  • Lentils are crucial as India is not self-sufficient in pulse production, and imports remain high.
  • Top lentil-producing states: Uttar Pradesh, Madhya Pradesh, West Bengal, Bihar, Jharkhand, Rajasthan.

Rapeseed and Mustard:

  • New MSP: ₹5,990 per quintal
  • Increase: ₹300 (5.27%)
  • This oilseed crop is the second largest after soybean in India.
  • Top rapeseed and mustard-producing states: Rajasthan, Madhya Pradesh, Haryana, Uttar Pradesh, West Bengal.

Safflower:

  • New MSP: ₹5,940 per quintal
  • Increase: ₹140 (2.41%)
  • Top safflower-producing states: Karnataka, Maharashtra, Telangana, Andhra Pradesh.

Government’s Rationale and Impact

Government’s Stance:

  • The Cabinet Committee on Economic Affairs, chaired by Prime Minister Narendra Modi, approved these MSP hikes. Information & Broadcasting Minister Ashwini Vaishnaw clarified that the announcement is not politically motivated, even though elections are approaching in states like Maharashtra and Jharkhand.
  • Agriculture Minister Shivraj Singh Chouhan emphasized that the government’s top priority is to ensure fair prices for farmers.

Regional and National Impact

Wheat Procurement:

  • The government procured 26.6 million tonnes of wheat in the current season (RMS 2024-25), benefiting 22 lakh farmers. However, this procurement has decreased compared to the 43.34 million tonnes procured during the 2021-22 season. Wheat stock in the central pool as of October 1 was 23.78 million tonnes, slightly lower than last year’s 23.99 million tonnes.

Gram Production:

  • Maharashtra, the largest gram producer, accounts for a quarter of India’s total production. Other significant gram-producing states include Madhya Pradesh and Rajasthan.

Lentil Imports:

  • India’s lentil imports nearly doubled in 2023-24, reaching 1.67 million tonnes, with most imports coming from Australia, Canada, Russia, USA, and Turkey. The MSP hike in lentils is significant as the government promotes pulse cultivation to reduce dependence on imports.

Oilseeds:

  • The rapeseed and mustard sector has seen the highest increase in MSP in absolute terms (₹300 per quintal), recognizing its importance as the second largest oilseed crop in India. These crops are critical to reducing India’s edible oil import dependence.

Future Implications

National Food Security and MSP Impact:

  • The government’s efforts to maintain sufficient wheat stock for the National Food Security Act (NFSA), 2013, will be crucial, especially with wheat stocks marginally lower than last year. The revised MSPs will likely provide some relief to farmers facing rising input costs, but procurement levels and market dynamics will ultimately determine how many farmers benefit from the MSP system.

Elections and Farmer Sentiment:

  • While the government denies any political motivation, the MSP hikes come at a crucial time as states like Maharashtra prepare for elections. With Maharashtra being a major producer of gram and other rabi crops, the MSP announcement is likely to influence farmer sentiment.

Prelims Takeaways:

  • National Food Security Act (NFSA), 2013
  • Minimum Support Prices

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