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A hike in the minimum support price (MSP) does not necessarily result in higher price realisation for farmers and thus needs systemic improvements. Analyse

Topic: Issues related to direct and indirect farm subsidies and minimum support prices

6. A hike in the minimum support price (MSP) does not necessarily result in higher price realisation for farmers and thus needs systemic improvements. Analyse. (250 words)

Difficulty level: Moderate

Reference: The Hindu

Why the question:

The Centre has increased the Minimum Support Price (MSP) for wheat for the upcoming rabi season by 2% hike. Oilseeds and pulses such as mustard, safflower and masoor dal saw higher MSP increases of up to 8% in a bid to encourage crop diversification.

Key Demand of the question:

To write about additional measures that are required for price realisation after increment in MSP price.

Directive word: 

Analyse – When asked to analyse, you must examine methodically the structure or nature of the topic by separating it into component parts and present them in a summary.

Structure of the answer:

Introduction: 

Start by writing about MSP, its aims and objectives.

Body:

Give the context about recent hike in MSP for certain Rabi crops.

Next, mention the limitations of the hike in MSP. Non-realisation of Price, Lack of procurement, only beneficial for selected crops, Lack of quality control and payment immediacy etc.

Next, write about the systemic measures that are needed for farmers to get remunerative prices. Increasing procurement efficacy, increasing awareness level of farmer and considering price deficiency payments etc.

Conclusion:

Conclude with way forward.