Minimum Support Price (MSP)
It is a pre-announced price, where the farmers are paid for their crops. It is set by the Government of India to procure crops directly from the farmers.
It is not enforceable by law. MSP rate is only to safeguard the farmer to get at least minimum profit for their harvest.
The government of India set the price for 23 commodities twice a year based on the recommendation of the Commission for Agricultural Cost and Prices (CACP) since 2009.
Msp calculation upsc
The MSP is calculated based on the cost of production, demand, supply, price fluctuation, market price trends, different cost and international market prices and agricultural wage rate.
23 Commodities Under Msp
- Niger seed
Cacp full form is Commission for Agriculture Costs and Price. It was set up in 1965 and it is a decentralised agency of the Central Government. It is a statutory body that is part of the Ministry of Agriculture & Farmers Welfare.
Its current chairmen was Vijay Paul Sharma.
This agency is the body that recommends the MSP (Minimum Support Price). CACP recommends MSP of 23 commodities.