On the 13th of February, Congress leader Rahul Gandhi promised to enact a Minimum Support Price (MSP) guarantee law if his party comes to power in the coming Lok Sabha Elections.
While addressing a gathering in Chhattisgarh’s Ambikapur, Rahul Gandhi said, “BJP government gave Bharat Ratna to M.S. Swaminathan. But the cause to which Swaminathan devoted his life, his recommendations on MSP, they are not ready to do. Swaminathan report clearly said that farmers should get MSP as a legal right. But the BJP is not doing this. If the INDIA alliance forms the government we will give MSP’s legal guarantee.”
UPA Govt in 2010 had rejected Swaminathan Commission report recommending MSP at 50% more than cost of production, claiming the move will distort markets
— Nabila Jamal (@nabilajamal_) February 14, 2024
But now, Rahul Gandhi promises same MSP law if they are voted to power #SwaminathanCommission #FarmersProtest… pic.twitter.com/PCuLQnkvO2
Taking to X, Rahul Gandhi wrote, “Farmer brothers, today is a historic day! Congress has decided to give a legal guarantee of MSP to every farmer on crops as per the Swaminathan Commission. This step will change the lives of 15 crore farmer families by ensuring their prosperity. This is the first guarantee of Congress on the path of justice.”
किसान भाइयों आज ऐतिहासिक दिन है!
— Rahul Gandhi (@RahulGandhi) February 13, 2024
कांग्रेस ने हर किसान को फसल पर स्वामीनाथन कमीशन के अनुसार MSP की कानूनी गारंटी देने का फैसला लिया है।
यह कदम 15 करोड़ किसान परिवारों की समृद्धि सुनिश्चित कर उनका जीवन बदल देगा।
न्याय के पथ पर यह कांग्रेस की पहली गारंटी है।#KisaanNYAYGuarantee
While the Congress party is now promising to legalise MSP if voted to power, back in 2010 his own party’s government led by the then Prime Minister Dr Manmohan Singh had rejected the Swaminathan Commission’s C2+50 per cent formula recommendation citing “counter-productivity”.
Back in 2010, KV Thomas, the Minister of State for Agriculture, informed the Rajya Sabha that the then-Manmohan Singh-led government did not accept the MSP recommendation, which was made by the Commission for Agricultural Costs and Prices (CACP) based on objective criteria and taking into account a variety of relevant factors.
“Hence, prescribing an increase of at least 50% on cost may distort the market. A mechanical linkage between MSP and cost of production may be counter-productive in some cases,” Minister Thomas had replied.
Notably, the Swaminathan Committee’s National Commission on Farmers had recommended that the MSP be at least 50% higher than the weighted average cost of production. This was referred to as the C2+50% formula, which included the capital input cost and land rent to provide farmers with 50% of the returns.
It is pertinent to note that although the Swaminathan Committee recommended that the MSP be at least 50% higher than the weighted average cost of production, it did not essentially make a case for the legalisation of MSP. The commission never asked for MSP to be made a legal right, contrary to what the Congress is trying to portray.
Notably, the National Commission on Farmers (NCF) was established on 18th November 2004, under the leadership of Professor M.S. Swaminathan. The terms of reference reflected the priorities outlined in the Common Minimum Programme. The NCF presented four reports in December 2004, August 2005, December 2005, and April 2006, respectively. The fifth and final report was submitted on 4th October 2006. The studies include proposals for achieving the “faster and more inclusive growth” goal outlined in the Approach to the 11th Five-Year Plan.
Before attacking the Modi government, Rahul Gandhi should question his own party as to why the UPA government did not implement the Swaminathan Committee’s recommendation with regard to MSP if the party actually cared for the farmers. The Congress party’s bold promise to make MSP a legal right comes when the farmers are protesting to press their demand for drafting a law on MSP.
The timing of the party’s sudden flip raises the question if Congress genuinely intends to support farmers or is just eyeing an opportunity to garner votes since the INDI Alliance is in a deplorable state and is miserably failing to put forth any strong fight before the Modi-led government.
Rahul Gandhi’s opportunism might prove destructive for not just the agriculture sector but also pose a threat to the country’s economic stability and growth.
A history of Congress’ duplicities and betrayals
Interestingly, this is not the first time that Congress has exposed its own duplicity. Back in 2019, the Congress party had in its Lok Sabha election manifesto promised to repeal the Agricultural Produce Market Committee. “Congress will repeal the Agricultural Produce Market Committees Act and make trade in agricultural produce — including exports and inter-state trade — free from all restrictions,” the party’s 2019 election manifesto stated.
However, when the Modi government introduced similar reforms in the year 2020, the Congress party vehemently opposed the government, clearly just for the sake of opposing. The Congress party back then called the three farm laws as ‘black laws’.
Interestingly, former Prime Minister Dr Manmohan Singh had also urged states to amend the APMC Act, giving farmers greater freedom in 2009 and 2012. But when the Modi government gave farmers the option to trade freely outside of APMCs, the same Congress took a hypocritical stand.
In 2020, a noticeable lack of uniformity was observed in then-Congress-ruled states such as Punjab, Chhattisgarh, and Rajasthan regarding legally guaranteed MSP for floor pricing. While these states passed farm bills to sidestep the now-repealed central farm regulations, there was no consistency in guaranteeing MSP. While the Punjab government’s bill guaranteed MSP only for wheat and paddy, Rajasthan’s bill mentioned MSP guarantees only for contract farming, and the Chhattisgarh bill was hazy on MSP assurances and dealt with concerns subjectively. In its entirety, none of these bills adequately addressed the protesting farmers’ demands for a legally enforced MSP, despite the Congress leadership’s claims of full support for farmers.
Congress playing South India-North India divide and ‘support for Punjab farmers’ at the same time
Irony starved to death when Congress leader and Karnataka deputy Chief Minister DK Shivakumar came forward to support the ‘Annadaatas’ over bringing MSP law. Taking to X on 12th February, Shivakumar wrote, “Union Govt promised to implement MSP law in 2021, and now we are in 2024 and still the govt has not fulfilled its promise to our farmers. More than 700 farmers lost their lives during the last protest, but our govt continues to play with their sentiments & their future with unfulfilled promises. Now, by constructing barricades it wants to stop the farmers from protesting for their rights. Look at the injustice of it all! Our farmers have every right & reason to protest against these injustices and we stand with them in this fight!”
Union Govt promised to implement MSP law in 2021, and now we are in 2024 and still the govt has not fulfilled its promise to our farmers.
— DK Shivakumar (@DKShivakumar) February 12, 2024
More than 700 farmers lost their lives during the last protest, but our govt continues to play with their sentiments & their future with…
While the Congress party is now suddenly worried about Punjab farmers, its leaders like DK Suresh were crying hoarse over “why South India tax money would fund North India development. The Karnataka Congress leader went as far as expressing his disdain for North India as he ended by saying that in the future, “South Indian states may demand a separate country for themselves and become a separate nation.”
How MSP is calculated?
The Central Government determines the minimum support price (MSP) using a formula that considers production costs and sets the price at one-and-a-half times these expenses. This approach takes into account both explicit costs (A2), which include expenses for goods such as seeds, fertiliser, pesticides, fuel, irrigation, hired labour, and leased-in land and the estimated value of unpaid labour done by family members (FL). Notably, the government determines MSP for 22 mandated crops based on recommendations from the Commission for Agricultural Costs and Prices (CACP), as well as the views of state governments and concerned Central Ministries/Departments.
Farmers protest and their demands
On Tuesday (13th February), a large number of farmers marched towards the national capital. In addition to drafting a law on MSP, the protesting farmers undertaking the ‘Delhi Chalo’ march have been demanding that India should quit the World Trade Organisation (WTO), halt trade agreements with other nations, and a monthly pension of Rs 10,000 to farmers who attain the age of 60 years among others. The protest has been called by Sanyukt Kisan Morcha and Punjab Kisan Mazdoor Sangharsh Committee, led by farmer union leaders Jagjeet Singh Dallewal and Sarwan Singh Pandher.
Notably, the MSP has increased substantially since the Modi government took power in 2014. In response to OpIndia’s RTI, the Government of India stated that the MSP for wheat per quintal has increased from Rs 1,350 in 2013-14 to Rs 2,015 in 2022-23. As reported earlier, the minimum support price for wheat increased from Rs 1,350 per quintal in 2013-14 to Rs 2,105 in 2022-23. The Modi government’s measures have ensured an increased income for the farmers over the years.
On 6th February, Arjun Munda, the Union Minister of Agriculture and Farmers’ Welfare informed the Lok Sabha that procurement of foodgrains has increased from 761.40 lakh metric tonnes in 2014-15 to 1062.69 lakh metric tonnes in 2022-23, benefitting more than 1.6 crore farmers. The expenditure incurred (at MSP values) on procurement of foodgrains increased from 1.06 lakh crores to 2.28 lakh crores, during the same period.
Bringing a law legalising MSP would involve a tremendous fiscal burden on the government exchequer, there would be a risk of undervaluation of crops with low yields, an increase in food inflation, market distortionary and economically unsustainable practices, and India would face opposition in the WTO as well as trade disputes with importing countries.
