Topic: Issues related to direct and indirect farm subsidies and minimum support prices;
5. The Minimum Support Price (MSP) system in India, designed to protect farmers from sharp declines in market prices, faces significant limitations. Analyse. (250 words)
Difficulty level: Moderate
Reference: Indian Express
Why the question:
The article discusses that import policy must be well-integrated with minimum support policy.
Key Demand of the question:
To write about the current limitations of MSP and changes that are needed in it.
Directive:
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:
Begin the defining the concept of MSP.
Body:
Frist, write about the various objectives behind MSP.
Next, write about the reasons as to why MSP has not achieved its stated objectives – MSP distorts the basic logic of the supply-demand mechanism, slows down the process of diversification, and is economically a very expensive and inefficient policy instrument, besides leading to massive leakages and corruption.
Next, discuss what needs to be done. Highlight the efforts of the government in this direction
Conclusion:
Write a way forward.
