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Price Deficit Finance Scheme for MP Farmers

In a first-of-its-kind initiative to compensate farmers in case of sharp fall in prices of agricultural produce.

Madhya Pradesh’s ‘agriculture’ cabinet gave its nod for a scheme where farmers would be paid the price difference between the minimum support price (MSP) and the prevailing modal price in case of a distress sale.

The ‘price deficit finance scheme’ would cover eight kharif crops including pulses (moong, urad and arhar), oilseeds (soyabean and groundnut) and maize as a pilot initiative this session.

Around 35 lakh farmers, of a total of 70 lakh farmers who grow oilseeds, pulses and maize in Madhya Pradesh, are expected to enroll themselves with the scheme in the first year.

“In case farmers sell their produce at a price below MSP but above modal prices, then the state government will transfer the difference between actual sales realisation and MSP. If the farmers sold his stocks at the price below the modal prices, then the government would reimburse the difference between MSP and modal prices,” Rajesh Rajora, principal secretary (agriculture).

The state cabinet also gave its nod for the creation of a Madhya Pradesh Agricultural Produce Costs and Marketing Commission. The state would deposit the money into farmers’ bank accounts; this would be done through dedicated portals by MP Civil Supplies Corporation (MPCSC) and Madhya Pradesh State Cooperative Marketing Federation (Markfed).

According to Rajora, the registration or enrolment of farmers under the scheme would be carried out between September 11-October 11, on the portals of the MPCSC and Markfed. The state has asked around 3,000 primary agricultural cooperative societies to help farmers register with the portal where details like Aadhaar numbers, bank account details, details of the crop cultivated and average yield would be uploaded. The scheme would cover tenant farmers as well. The designated mandis in the state would upload the details about the sale and purchase by farmers on the respective portals to ensure payments to farmers after the purchase session is over.

For actual payment to farmers, the average yield in a particular district will also taken into account to discourage misuse of the scheme by farmers and traders. The state would also approach the Centre for financial assistance to run the scheme. At present, only moong dal prices are prevailing below the MSP. The state government had purchased around 9 lakh tonne of onions at `8 per kg from farmers.


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