HYDERABAD : The State Government has decided to exempt the sum of Rs. 40 allowed to farmers from market cess and value added tax (VAT) as part of the hike in minimum support price (MSP) for paddy.

After the recent increase in MSP by Rs. 50 by the Centre, the MSP for paddy stands at Rs. 650 per quintal for `A' grade and Rs. 620 for common variety. Out of this hike, Rs.10 is the real increase in the MSP while Rs. 40 is allowed to the farmer as `bonus.'

State's plans

Announcing the `bonus' at a press conference here on Thursday, Civil Supplies Minister N. Raghuveera Reddy said that plans had been drawn up to procure 20 lakh tonnes of paddy during kharif, 10 lakh tonnes during rabi through the Civil Supplies Corporation and the FCI.

Paddy production was expected to touch an all-time high of 145 lakh tonnes both for kharif and rabi this year as against the last year's achievement of 117 lakh tonnes.

The Minister said for the first time, Indira Kranthi Pathakam self-help groups would be involved in a big way in the procurement.

They would handle 232 out of 571 purchase centres planned, covering 2,430 villages.

The Government provided an assistance of Rs 10,000 each to the groups, apart from tarpaulins, weighing machines and moisture-testing machines and training by Marketing Department.

Record quantity

Similarly, a record quantity of eight lakh tonnes of maize would be procured this year as against 5.6 lakh tonnes last year through 360 purchase centres, of which 287 would be under control of the self-help groups. Marfed would act as nodal agency for this big operation.

Mr. Reddy said a decision had also been taken to allow an incentive of Rs.340 over the Central MSP for redgram, blackgram and greengram taking the total price payable to farmers in each case to Rs 1,750 per quintal.

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