What is Swaminathan formula for MSP?

Swaminathan’s report also states that the net take-home income of farmers should be comparable to those of civil servants. On September 28, 2017, Swaminathan tweeted that MSPs should be calculated to cover C2+50\%, in addition to being accompanied by procurement, storage and distribution.

How the MSP is calculated?

1.5 Times MSP Formula = 1.5 times the A2+FL costs The Government after considering this stated that the Production Cost is one of the main factors to determine the MSP. Also, the CACP considers all the costs in a comprehensive manner. To determine the MSP, the CACP considers both C2 and A2+FL costs.

How is MSP price decided?

The minimum support prices are announced by the Government of India at the beginning of the sowing season for certain crops on the basis of the recommendations of the Commission for Agricultural Costs and Prices (CACP).

How the 1.5 times formula for crops MSP is calculated?

1.5 times MSP Formula = 1.5 times the A2+FL costs The CACP considers both C2 and A2+FL costs to determine the MSP. CACP considers the A2+FL formula for return and C2 formula as a benchmark reference costs to make sure that the MSP covers the production cost.

How is MSP calculated Upsc?

The MSP is the rate at which the government purchases crops from farmers, and is based on a calculation of at least one-and-a-half times the cost of production incurred by the farmers. The Union Budget for 2018-19 had announced that MSP would be kept at levels of 1.5 the cost of production.

What is A2 and C2 in MSP?

‘A2’ covers all paid-out costs directly incurred by the farmer — in cash and kind — on seeds, fertilisers, pesticides, hired labour, leased-in land, fuel, irrigation, etc. ‘C2’ is a more comprehensive cost that factors in rentals and interest forgone on owned land and fixed capital assets, on top of A2+FL.

WHO calculates MSP?

The Indian government sets the price for about two dozen commodities twice a year. MSP is fixed on the recommendations of the Commission for Agricultural Costs and Prices (CACP), an apex advisory body for pricing policy under the Ministry of Agriculture.

How is MSP calculated in UPSC?

How many commodities are covered under MSP?

As of now, CACP recommends MSPs of 23 commodities, which comprise 7 cereals (paddy, wheat, maize, sorghum, pearl millet, barley and ragi), 5 pulses (gram, tur, moong, urad, lentil), 7 oilseeds (groundnut, rapeseed-mustard, soyabean, seasmum, sunflower, safflower, nigerseed), and 4 commercial crops (copra, sugarcane.

What is C2 formula for MSP?

The National Commission for Farmers, constituted under the chairmanship of agricultural scientist MS Swaminathan, in its report had recommended that farmers should be given Minimum Support Price (MSP) under the C2+50 percent formula. That is, the total cost of the crop (C2) and the profit thereon is 50 percent.