The Central government’s decision to hike the Minimum Support Prices (MSPs) for vital crops in the coming rabi season and the announcement of a hike in the MSP for paddy during the kharif marketing season 2007-08 shows that it is sensitive to the  legitimate aspirations of  farmers who seek more remunerative prices for their produce. With inflation showing a downward trend, the government availed the opportunity to announce the highest-ever hike in the MSP for wheat in the coming rabi season and substantially hiked the support prices of  pulses and oilseeds. It has also shown some amount of pragmatism by announcing the MSPs for the forthcoming rabi crop well before planting time.

By substantially hiking the MSPs of virtually all types of crops the government definitely seeks to offer incentives to farmers to increase their output. Considering the fact that the country is witnessing an alarming phase of stagnation in farm production, extension of more incentives to farmers to produce more crops is a step in the right direction. However, there is apprehension in some quarters that a hike in MSPs will further stoke inflation. But viewed from a wider perspective, it will be unfair to deprive the farmers of a higher price for their produce when other sections of the economy are reaping the benefit of the ongoing growth momentum.

But the key question is whether the hike in MSPs will lead to an increase in the production of food crops.  The current trends in crop pattern changes and acreage shifts suggest that there may not be any significant rise in the production of primary food crops like wheat and rice. On top of the ongoing stagnation, the growing inclination among farmers to opt  for non-food cash crops is affecting the overall availability of cereals. It will be naïve on the part of the government if it thinks that it can encourage farmers to increase production only through the mechanism of enhanced MSP. It is high time that the government seriously focussed its attention on evolving a long-term food grain policy including a strategy for boosting agro production. It should take into account factors like the newly emerging phenomenon of rapid changes in food habits and crop patterns. Sustained efforts must be made to enhance agricultural productivity through the induction of the latest farming technology.