Perception, Reality, and Optimality: The MSP Composite in relation to the Farm Acts (The Rise)

The Rise (India) published an op-ed by Mamata Pradhan, Senior Research Fellow Devesh Roy, and Sunil Saroj. The authors write, “Agriculture in India needs to get the markets right, in the first place. Only then can the raising of farmers’ incomes to a reasonable level become a reality. Across space or over time, farmers should be able to trade freely with certainty. If MSP were a panacea, we would not be having any conversation, in the first place, about doubling farmers’ income more than five decades on.” The authors conclude saying, “Farmers could be incentivized or rewarded based on the ecosystem implications of their choices. This could also mean India not having to fight tooth and nail for the MSP system in the WTO, which has a peace clause. The government does not have the capital for procurement of all types of perishable goods and the fiscal cost for procuring coarse cereals could be very large. Yet, these principles could be applied to crops, like pulses, that have played an important role in relative price increases in food.”