New Delhi, September 21: The government on Monday hiked the Minimum Support Price (MSP) for wheat by Rs 50 per quintal to Rs 1,975 per quintal. The announcement was made by Union Agriculture Minister Narendra Singh Tomar to encourage farmers to increase cultivation of the crop. In a series of tweets, Tomar informed about the decisions taken in agricultural sector at a meeting of the Cabinet Committee on Economic Affairs (CCEA) chaired by Prime Minister Narendra Modi. MSP And Farm Bills: PM Narendra Modi Assures Farmers That Minimum Support Price Will Continue as Before.

The announcement by the government comes in the backdrop of widespread protests by Opposition parties. Moreover, several farmer groups in Punjab, Haryana and some other states have also staged demonstrations after Parliament passed two key farm bills on Sunday. The government has backed these farm bills stating that it will give farmers' marketing freedom and better price for their produce. Farm Bills: What Are The 3 Legislations Brought by Modi Government? Why Are Farmers Protesting? All You Need to Know.

Here's the tweet by Narendra Singh Tomar:

What is Minimum Support Price (MSP)

  1. The Minimum Support Price (MSP) is a form of market intervention by the Government for agricultural producers against any sharp fall in farm prices.

  2. The MSP are announced by the Government at the beginning of the sowing season for certain crops on the basis of the recommendations of the Commission for Agricultural Costs and Prices (CACP).

  3. MSP is price fixed by the government to protect the farmers against excessive fall in price during bumper production years. The MSP is therefore, a guarantee price for their produce from the Government.

  4. The major objectives are to support the farmers from distress sales and to procure food grains for public distribution.

  5. In case the market price for the commodity falls below the announced minimum price due to bumper production and glut in the market, government agencies purchase the entire quantity offered by the farmers at the announced minimum price.

The three farm bills that were passed by the Parliament include- The Farmers' Produce Trade and Commerce (Promotion and Facilitation) Bill, 2020 and The Farmers (Empowerment and Protection) Agreement of Price Assurance and Farm Services Bill, 2020. Tomar said the CCEA has approved increasing MSP of six rabi crops. The Minister said the government has always maintained that MSP and APMC mechanisms will continue as against a false propaganda spread by Opposition parties.

(The above story first appeared on LatestLY on Sep 21, 2020 07:09 PM IST. For more news and updates on politics, world, sports, entertainment and lifestyle, log on to our website latestly.com).