The Union Cabinet led by Prime Minister Narendra Modi cleared the minimum support price (MSP) for all 14 kharif season crops. The MSP for paddy has been hiked by 5.36% year-on-year to ₹2,300 per quintal for marketing season 2024-25. The MSP for paddy was ₹1,310 in 2013-14.

“One very important decision has been taken for the welfare of farmers. Kharif season is starting, and for that, the Cabinet has approved MSP on 14 crops. The new MSP for paddy is ₹2,300, which is a ₹117 increment over the previous MSP,” says Union minister for information and broadcasting Ashwini Vaishnaw at a media briefing.

The increase in MSP for kharif crops is in line with the Union Budget 2018-19 announcement of fixing the MSP at a level of at least 1.5 times of the all-India weighted average cost of production.

PM Modi has promoted millet production and processing and today’s decision is a testament to the government’s commitment to millets, says Vaishnaw.

MSP for bajra has been hiked by 5% to ₹2,625 per quintal while MSP for ragi has been increased by 11.55% to ₹4,290.

In the recent years, the government has been promoting cultivation of crops other than cereals such as pulses and oilseeds, and nutri-cereals by offering a higher MSP for these crops.

The expected margin to farmers over their cost of production are estimated to be highest in case of bajra (77%) followed by tur (59%), maize (54%) and urad (52%). For rest of the crops, margin to farmers over their cost of production is estimated to be at 50%.

The government says it has increased the MSP for kharif crops to ensure remunerative prices to the growers for their produce. The highest absolute increase in MSP over the previous year has been recommended for oilseeds and pulses such as nigerseed (₹983 per quintal) followed by sesamum (₹632 per quintal) and tur/arhar (₹550 per quintal).

The MSP for medium staple cotton has been raised to ₹7,121 this year, about ₹501 more than the MSP for the previous year.

Vaishnaw says India plans to become self-reliant in pulses and oilseeds. To achieve this, the MSP for tur has been raised by ₹550 over the previous year to ₹7,550. For moong, the MSP has been hiked by ₹124 to ₹8,682. MSP for urad has been increased to ₹7,400, ₹450 more than the previous year.

The government plans to set up 2 lakh warehouses under primary agriculture cooperatives, says the Union minister.

“The third term of PM Modi is very important as it focuses on continuity with change through many decisions for farmers's welfare,” the minister says.

After today’s decisions, farmers will get ₹2 lakh crore as MSP, ₹35,000 crore more than the previous season, says Vaishnaw, adding that this will significantly improve farmers’ income.

Follow us on Facebook, X, YouTube, Instagram and WhatsApp to never miss an update from Fortune India. To buy a copy, visit Amazon.