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  • Mukherjee speaks against hike in MSP

    Published on August 5, 2010

    Expressing concern over high food prices, Finance Minister Pranab Mukherjee on Wednesday said the hike in minimum support price to farmers was not a populist measure, but was taken to ensure higher foodgrains production in the country.

    “We have to give more price to farmers. It is not a populist scheme if we increase (minimum support price),” Pranab said in the Lok Sabha in his reply to a debate on ‘inflationary pressure on the economy and its adverse impact on the commonman’.

    The minimum support price (MSP) of wheat was increased from Rs 640 per quintal to Rs 1,100 per quintal between 2004-2009 to ensure production goes up, he said, adding that even the procurement price of sugarcane was increased to Rs 129 per quintal to boost output.

    The minister said that price situation was affected due to perpetual shortfall in production of pulses and edible oils. “Despite the launch of the Oilseeds and Pulses Mission, we could not achieve much success in production as we have achieved in foodgrains, milk and others,” Mukherjee noted.

    India, the world’s largest importer and consumer of pulses, is facing pulses shortage of 3-4 million tonnes. Similarly, the shortage of edible oil is over one million tonnes, he said.

    In 2009-10, the country’s pulses production is estimated to be at 14.59 million tonnes, while that of oilseeds at 24.92 million tonnes, according to the official data.

    The minister said that the government has identified 60,000 villages to promote pulses and oilseeds production. “The work has already started and this year we expect more production of pulses and oilseeds,” he said.

    Mukherjee also pointed out that powers are vested with the state governments to control price rise by checking hoarding under the Essential Commodities Act, “but will not pass on the buck to them alone.”

    Demanding the states cooperation in revamping PDS, the minister said, “PDS is one of the biggest instruments to ameliorate peoples’ suffering by providing subsidised foodgrains. Both Centre and states need to take concrete steps to revamp PDS.”

    The government provides 35 kg of rice and wheat to 6.52 crore poor families every month at cheaper rates.

    Even though food inflation has declined to a single digit, it still at an elevated level of 9.67 per cent

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