A hike in Minimum Support Price of key winter crops was announced by the government on Monday evening amid the huge row by upset farmers, who have been worried that the new farm laws would affect the existing MSP system. The hike -- a month ahead of last year's schedule -- came after days of farmers' protests and assurances by the Prime Minister Narendra Modi and his ministers that the MSP will not be scrapped. PM Modi called the hike a "another historic decision".
The MSP hike announced today covered wheat, the key crop in Punjab and Haryana, where the farmers' protest has been loudest. The MSP of wheat has been increased by Rs 50 a quintal and will be Rs 1975 per quintal this season. The other big crop in the area, mustard, will now fetch Rs 4,650 a quintal -- a jump of Rs 225 a quintal.
The price of grams and lentils has also moved up. The price of gram has gone up by Rs 225 to touch Rs 5,100. Lentils had the highest hike -- Rs 300 a quintal and will now cost Rs 5,100 a quintal.
In a statement to the media, the government said the Cabinet Committee on Economic Affairs or CCEA chaired by PM Modi approved the increase in the MSPs for Rabi crops in line with the recommendations of Swaminathan Commission.
"It is our great privilege to work for the welfare of our farmers. In line with our ethos of taking farmer-friendly measures, the Cabinet has taken another historic decision to raise MSP. Crores of farmers will benefit from this," PM Modi tweeted.
Punjab Chief Minister Amarinder Singh termed the government's action "callous". "They have made a mockery of the farmers' protests over the Farm Bills, which by all accounts will eventually pave the way for ending the MSP system and abolish the Food Corporation of India," said the Chief Minister.
If the BJP-led Central government thought it would appease the agitating farms with this trifling hike they clearly did not understand the situation, he added.
While the proposed farm laws have not eliminated the Minimum Support Price system, it has made it possible for small and marginal farmers to sell crops to private enterprises at competitive prices.
The farmers are now concerned that they would be shortchanged, since it would not be possible for the government to oversee the thousands of transactions each day. The opposition has said the bills would benefit corporates at the expense of farmers.
Despite PM Modi's assurances on the subject, the Akali Dal ended its long running partnership with the BJP last week over the issue, drawing a barb from the BJP's former ally Shiv Sena.
Sena leader Sanjay Raut said, "Prime Minister Narendra Modi has said that the system of MSP will not end in the country and the rumor is being spread about it...So has the Shiromani Akali Dal resigned from the government only on the basis of this rumor?"
On Monday, PM Modi took a swipe at the opposition, saying after the historic changes in the agri-sector, "Some people are losing their control of it. So now these people are trying to mislead farmers on MSP (minimum support price)".
They are also the "same people who sat for years on the recommendations of the Swaminathan committee on MSP," PM Modi said in an apparent swipe at the Congress, during whose watch the national Commission was formed.