The government today announced a token increase of Rs20 a quintal in the procurement price for wheat next year, a move that is aimed at stabilizing the retail prices as also give positive signal to farmers.
As on October one, the Centre had 28.4 million tonnes of wheat in the buffer stock against a norm of 11 million tonnes.
"The MSP of wheat has been fixed at Rs 1,100 per quintal, marking an increase of Rs 20 per quintal over the last year's MSP," Home Minister P Chidambaram said after the meeting of the Cabinet Committee on Economic Affairs.
Last year, the government had raised wheat MSP by Rs 80 to Rs 1,080 a quintal. But this year, the Centre seems to have decided to give nominal increase as prices of essential food items are rising because farm production have been hit due to drought and floods.
Record production and higher remunerative price last year helped the government in achieving record procurement of wheat in 2009-10 marketing season (April-March) at over 25 million tonnes. Wheat output stood at 80.58 million tonnes last year.
The government also announced MSP for other rabi crops. Chana MSP has been raised by Rs 30 to Rs 1,760 per quintal. MSP of mustard and masur have been kept unchanged at Rs 1,830 per quintal and Rs 1,870 per quintal, respectively.
Chidambaram said the government has accepted the report of the Commission for Agricultural Costs and Prices, which recommends MSP for different crops, for the Rabi season.
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