The Cabinet Committee on Economic Affairs, chaired by Prime Minister Narendra Modi, has approved an increase in the Minimum Support Prices (MSP) for 14 kharif crops for the 2025–26 marketing season.
The move aims to provide farmers with remunerative prices for their produce, according to an official statement released on Wednesday.
Among the crops, nigerseed received the highest absolute MSP hike of ₹820 per quintal. Ragi followed with a ₹596 hike, cotton with ₹589, and sesamum with ₹579.
The MSP hike aligns with the Union Budget 2018–19 announcement to fix MSPs at least 1.5 times the all-India weighted average cost of production.
The government expects farmers to receive the highest returns for bajra (63%), followed by maize (59%), tur (59%), and urad (53%), while other crops are estimated to yield a 50% profit margin over their production costs.
The calculation of total production cost includes expenditures on human labour, machinery, land rent, seeds, fertilisers, manure, irrigation, depreciation, diesel/electricity, working capital interest, miscellaneous expenses, and the imputed value of family labour.
In recent years, the government has encouraged the cultivation of non-cereal crops, such as pulses, oilseeds, and nutri-cereals (Shree Anna), by offering higher MSPs to promote agricultural diversification.
Between 2014–15 and 2024–25, the government procured 7,608 LMT (lakh metric tonnes) of paddy and paid ₹14.16 lakh crore in MSP to paddy farmers.
This is a significant rise from 4,590 LMT and ₹4.44 lakh crore paid between 2004–05 and 2013–14.
For all 14 kharif crops, procurement between 2014–15 and 2024–25 stood at 7,871 LMT, with ₹16.35 lakh crore disbursed to farmers.
In contrast, the 2004–05 to 2013–14 period saw procurement of 4,679 LMT and payments of ₹4.75 lakh crore.
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