The Hindu : New Delhi News : Wheat MSP hiked by Centre to Rs. 1,000 per quintal

Online edition of India's National Newspaper
Wednesday, Oct 10, 2007
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New Delhi

Wheat MSP hiked by Centre to Rs. 1,000 per quintal

Gargi Parsai

NEW DELHI: With the possibility of mid-term elections looming large, the Centre on Tuesday announced the highest-ever hike in the minimum support price of wheat for the coming rabi season, gave an incentive bonus on the support price for kharif rice and banned the export of non-basmati rice. Substantial hike in the support price of barley, gram masur, rapeseed/mustard and safflower were also declared.

The government also announced a relief package for the sugar industry, particularly to benefit the farmers. The package includes extending moratorium from two to five years on outstanding term loans.

The Cabinet Committee on Economic Affairs chaired by Prime Minister Manmohan Singh approved a Food Ministry proposal for setting the minimum support price of wheat at Rs. 1,000 per quintal against Rs. 850 per quintal (including a bonus of Rs. 100 per quintal) last year, in the face of criticism for importing wheat at Rs. 1,600 per quintal.

The CCEA also took the decision to give an “incentive bonus” of Rs. 50 per quintal during the kharif marketing season, 2007-08. The bonus would be given with retrospective effect for the entire procurement period. The support price for common variety of rice would thus be Rs. 695 per quintal and for Grade ‘A’ rice it would be Rs. 725 per quintal including the Rs. 50 incentive bonus. This will encourage farmers to grow more paddy and also contribute more to the central pool since there is a shortfall in procurement of wheat for the last two years.

Announcing the decisions, Union Finance Minister P. Chidambaram told journalists that the ban on export of non-basmati rice was imposed in view of the increasing domestic requirement. The off take of rice in the Public Distribution System had increased from 105 lakh tonnes in 2002-03 to 212 lakh tonnes in 2006-07.

The CCEA also gave its nod for enhancing the minimum support price of barley to Rs. 650 per quintal from Rs. 565 per quintal last year. The support price for gram has been raised to Rs. 1,600 per quintal against Rs. 1,445 last year. The price for masur (lentil) has been hiked to Rs. 1,700 per quintal from Rs. 1,545 last year. The minimum support price for rapeseed/mustard oilseed has been hiked to Rs. 1,800 per quintal from Rs. 1,715 per quintal last year. The support price for safflower has been set at Rs. 1,650 per quintal as against Rs. 1,565 per quintal.

The government said that the prices of other oilseeds belonging to the rapeseed/mustard group would be fixed on the basis of their normal market price differentials with rapeseed/mustard.

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