[Solved] Consider the following statements: 1. In the case of cereals, pulses and oil-seeds, the procurement at Minimum Support price (MSP) is unlimited in any of India. 2. In the case of cereals and pulses, the MSP is fixed in any State/UT at a level to which the market price will never rise. Which of the statements given above is/are correct?

Q79. Consider the following statements:

1. In the case of cereals, pulses and oil-seeds, the procurement at Minimum Support price (MSP) is unlimited in any of India.

2. In the case of cereals and pulses, the MSP is fixed in any State/UT at a level to which the market price will never rise.

Which of the statements given above is/are correct?

A. 1 only

B. 2 only

C. Both I and 2

D. Neither I nor 2

Answer: D

While procurement is open-ended, it is not unlimited since our buffer stock is limited. Hence statement 1 is incorrect.

Market price has no link with Minimum Support Prices and it can go below or above MSP depending upon the demand of crop in the market, hence statement 2 is incorrect.

The chief objectives of setting up MSP are:

Support farmers from distress sales To procure food grains for public distribution Issue Price is the price at which the procured and buffer stock food grains are provided through the PDS.

Extra:

The MSP is recommended by the Commission for Agricultural Costs and Prices and announced by Cabinet Committee on Economic Affairs.

MSP for sugarcane is known as Fair and Remunerative Prices. Presently, there are 23 crops covered by MSP, namely:

Cereals (7) – paddy, wheat, barley, jowar, bajra, maize, and ragi

Pulses (5) – gram, arhar/tur, moong, urad, and lentil

Oilseeds (8) – groundnut, rapeseed/mustard, toria, soybean, sunflower seed, sesamum, safflower seed, and nigerseed

Raw cotton

Raw jute

Copra/ De-husked coconut

Sugarcane (Fair and remunerative price)