Wheat purchases at MSP hit a record; Punjab farmers get Rs 3 lakh per capita

The Centre has purchased a record 43.3 million tonnes wheat from farmers in the rabi procurement season that just ended, up 11% over the previous winter crop season. Farmers received a record Rs 84,369 crore in their bank accounts for the wheat they sold to the government procurement agencies led by the Food Corporation of India (FCI) since April this year.

The entire MSP funds have been routed through the direct benefit transfer (DBT) mechanism. Significantly, farmers in Punjab, who are at the forefront of a prolonged agitation against the three reform-oriented farm laws being put in abeyance, are the biggest beneficiaries of the MSP transfers.

On an average, a Punjab farmer fetched Rs 2.95 lakh for the wheat crop this season, compared with Rs 2.2 lakh in Haryana. The average in Uttar Pradesh works out to Rs 93,000 a farmer.

Until last year, Punjab and Haryana had chose to the remain out of the DBT system; they joined the scheme for the current rabi season. While Haryana implemented it smoothly, Punjab put up a resistance, before finally agreeing to adopt it.

Official agencies like FCI purchase about a third of the wheat from Punjab out of total quantity they procure in the season. This year, Punjab contributed 13.21 million tonnes to the procurement pool, up 4% on year and the highest quantity among states.

Though the MSP value of last year’s procurement was Rs 24,474 crore (at Rs 1,925 per quintal), the FCI had to pay market fee (3%), rural development cess (3%) and arhatiya commission (2.5%) extra, which was estimated to be around Rs 2,080 crore. The Centre has agreed for continuation of arhatiya commission, but shifted from payment of a percentage of MSP to a fixed amount from last year.

The country’s wheat output had hit an all-time high of 109.24 million tonnes during 2020-21 crop year (July-June). Wheat procurement in the country begins from April 1 every year and ends in June 30, though over 95% of the total volume purchased in first two months.

Leave a Reply

Your email address will not be published. Required fields are marked *