Cabinet okays INR150bn crore new procurement policy to assure MSP to farmers

  • Ahead of the 2019 polls, the government announced on 12 Sep 18 that an INR150bn procurement policy allowing states to choose a compensation scheme and rope in private agencies for procurement to ensure a remunerative price to farmers.
  • The new umbrella policy ‘Pradhan Mantri Annadata Aay SanraksHan Abhiyan’ (PM-AASHA) was approved in the Cabinet meeting, headed by Prime Minister Narendra Modi, held there.
  • Under the PM-AASHA, states would be allowed to choose from three schemes – existing Price Support Scheme (PSS), newly designed Price Deficiency Payment Scheme (PDPS) and Pilot of Private Procurement Stockist Scheme (PPSS) – to undertake procurement when prices of commodities fall below the MSP level, Agriculture Minister Radha Mohan Singh said.
  • The Cabinet has sanctioned INR150bn to implement the PM-AASHA in the next two financial years, of which INR62.5bn will be spent in 2018.
  • Under the new policy, the states will also have an option to choose the existing Price Support Scheme (PSS), under which central agencies procure commodities covered under the MSP policy when prices fall below the MSP.
  • Singh further said that the government is committed to realizing the vision of doubling farmers’ income by 2022.

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