Farmers' Protest: Why Agri Unions' MSP Demand Could Prove To Be 'Anti-Farmer'?

Farm unions are demanding to enact a law guaranteeing a minimum support price (MSP) for all crops, as recommended by the Swaminathan Commission report.

Farmers' protests have entered the fourth day today and there is chaos at the borders leading to Delhi. Protests are continuing in Punjab, Haryana, and Uttar Pradesh as the government is negotiating a mid-way path. The Samyukta Kisan Morcha (Non-Political) and the Kisan Mazdoor Morcha are spearheading the 'Delhi Chalo' agitation to put pressure on the Centre over their demands, including a law on minimum support price for crops and loan waivers. According to the protesting farmers, the centre promised them better crop prices, after which they ended the 2021 protest. They are demanding to enact a law guaranteeing a minimum support price (MSP) for all crops, as recommended by the Swaminathan Commission report.

However, experts feel that such a move could prove detrimental to farmers instead of helping them. Dr Ashok Gulati, Agricultural economist & Distinguished Professor at ICRIER, said that MSP for all crops could be 'anti-farmer' as well. Explaining his argument further, Dr Gulati said, "Normally, the prices are decided by demand and supply. If the MSP is made legal, assuming that the production of a particular commodity is 100 but the demand is 70, then what will happen? Nobody will touch it and the remaining 30 will stay with the farmers. What can they do? Because, if one buys at a price lower than MSP, he may land behind bars."

He also said that the implementation of MSP across the country for 23 commodities may be impossible. He said that the 23 commodities on which MSP is being demanded constitute only 28 per cent of the total agri produce of India. "That segment of agriculture which is flying high at a growth of 8-9 per cent is poultry- is there an MSP on it? Growth of fisheries is 7-8% per annum for the last 10-15 years. Is there an MSP for it? Milk is bigger than rice, wheat, and pulses put together. There is no MSP for it but is growing between 5-6% per annum. 72 per cent of agriculture is driven by market prices and not by MSP," he said.

He said that to mitigate nature's risk, farmers can take crop insurance if they wish but they will have to pay a premium for it which is subsidized by the government. On being asked if MSP law demand is not met  & on crashing prices of commodities, Dr Ashok Gulatis said, "For such crisis, there is price stabilisation fund. In such a situation, the government should come forward to either give compensation or procure."

He further said, "Punjab is at least 20 years behind diversification and if they don't diversify, they are playing with the future generations of Punjab. Because the water table in Punjab is going down by more than a meter every year...They are way behind at least 20 years on that path. The leadership of Punjab has failed the peasants of Punjab..." He also said that despite wheat and rice having the MSP, only five to six states have managed to implement it fully. He cited the example of Bihar where the crop is sold 20-25% below MSP.