Chandigarh, December 16
A move that might not go down well with states, the Union government is likely to fix the minimum support price (MSP) of wheat for the upcoming marketing season, beginning April next, at Rs 1,080 per quintal, as had been recommended by the Commission on Agricultural Costs and Prices (CACP).
Highly placed sources in the Ministry of Agriculture informed TNS that the MSP had to be announced after the Cabinet meeting yesterday but was deferred on account of several states demanding it be hiked to Rs 1,200 per quintal. The government, said sources, was dithering
on increasing the wheat MSP in view of the sharp decline in its global prices, presently hovering around Rs 950 per quintal.
Moreover, the Government of India has been providing sops on wheat imports, resulting which a number of private flour mills and biscuit manufacturers are finding it cheaper to import wheat at Rs 950 per quintal than to purchase it at a higher MSP of Rs 1,000 per quintal here.
Also, the government has to take into account the Rs 200 per quintal it has to spend as freight and landing cost (over and above the MSP) in states like Tamil Nadu, Karnataka and Western India.
While keeping all these facts in mind, said sources, the Cabinet was likely to take a decision later this week and fix the MSP as per the recommendations of CACP, the nodal agency that manages the MSPs of various commodities.
Meanwhile, the Agriculture Ministry is targeting to increase the area under wheat by 1 million hectare this year from 281.5 lakh hectare in 2007-08. The production target has been fixed at 785 lakh tonne, compared with an output of 784 lakh tonne last year.
