Legalise MSP, Procure Agricultural Produce Directly from the Peasants


Legalise MSP, procure agricultural produce directly from the peasants and introduce ‘‘all out state trading’’ of agricultural produce and essential commodities — All India Kisan Khet Mazdoor Sangathan (AIKKMS)

The demands of the year-long historic peasant movement in Delhi were: (i) Repealing of three pro-corporate black farm laws, (ii) Legalising MSP and (iii) ensuring government procurement of agricultural produce directly from the peasants at one and half times of the cost of production. Under pressure of the movement, central BJP government had to repeal the three black farm laws and assured the peasants that it would take urgent step to fulfil the demand on MSP and government procurement of the agricultural produce. But till now, the central BJP government has not taken any step in that direction. Rather, it is airing some false arguments against this demand to create confusions among the common people in order to turn them against the demand on MSP of the peasant movement. So, it is our bounden duty to show the falsity of its arguments for the interest of the common people.
The central BJP government and the economists and columnists on their pay-roll are mainly airing two arguments:
First, in order to legalise MSP and governmental procurement, a huge amount of money is needed. The government is in acute fiscal crisis. So, it is not possible to spend such a hefty amount at this moment.
Second, if the government starts purchasing all the agricultural produce at MSP, the price of the agricultural commodities would go up in the retail market causing immense hardship to the common people.
So, according to the government and its pliant quarters, those who are demanding legalization of MSP and insisting on government procurement of the agricultural produce at 1½ times of production cost are against the interest of the common people,—workers, poor city-dwellers, agricultural workers, etc., who have a meagre purchasing power.
We are aware of the unbridled sky rocketing of the prices of all essential commodities. We all are experiencing its bitter impact on our life daily, if not hourly. But what is causing this phenomenal price rise? Why the price of the industrial products is soaring? Why the retail tariff of petrol-diesel-LPG is rising astronomically? The peasants are selling potato or onion at Rs 2 per kg. But the consumers are purchasing the same at an exorbitant price of even Rs 30 to Rs 50 per kg. Is it because of MSP? The simple answer is, ‘‘NO’’. It is because the entire system of procurement, storage and distribution is in the hands of the profit-monger business tycoons and multinationals. They are controlling the entire process with the objective of reaping maximum profit, both by deceiving the peasants and squeezing the common consumers. So, there is a spurt in prices. It has nothing to do with MSP.
Next is the question of paucity of funds. How much money would be required if the central government introduces MSP in agricultural produce? Let us examine. At present, there is MSP on 23 items. Among those 23 items, 7 are cereals (paddy, wheat, maize, jawar, ragi, barley, etc.), 5 are pulses (chana, arhar, moong, urad and masur), 7 are oilseeds (ground nut, soyabean, rapeseed, mustard, sunflower etc.) and 4 are commercial crops (sugarcane, cotton, raw jute etc.,), procurement price of all these items at MSP is around 10.78 lakh crore rupees. But it is a fact that all these produces are not sold in the market. Why? Because,
a) the producers themselves apportion a part of the produces for their own consumption,
b) they use a portion for seed for the next sowing season and
c) for feeding their cattle.
It is seen that the marketed quantities of the agricultural produces are as below:
a) Ragi below 50 percent;
b) Wheat 75 percent;
c) Paddy 80 percent
d) Sugarcane 85 percent;
e) Most of the pulses 90 percent;
f) Cotton, Jute, etc., 95 percent.
Taking an average of 75 percent, the price of total procurement would be around Rs 8 lakh crore. This is the MSP value of the marketable 23 produces. That means, if the government purchase all the marketable surplus of those 23 items, then 8 lakh crore rupees are required.
Now firstly, let us exclude sugarcane from this list. Because onus of payment for its procurement lies on the sugar mill owners as they buy the crop from the peasants. So it is, according to law, their responsibility to pay the peasants.
Secondly, it is not necessary to purchase every gram of cotton or jute. Government needs to purchase a considerable portion of cotton and jute so that it might create a market effect. We saw that in 2019-20, the government purchased 87.85 lakh bales of cotton out of 350.50 lakh bales and it created a considerable market effect. And the peasants got remunerative price in the open market. So, if the government announces to purchase at least 40 percent of the total production of cotton and jute it will help the peasants to get remunerative price in the open market also. The financial burden on the government will be lowered.
And, thirdly, the government should undertake the responsibility of selling the foodgrains and other necessary agricultural produce to the people at cheaper rate through its own distribution network. The sale proceeds of such distribution would bring in a hefty revenue to the government exchequer. And at the same time, people would get food and essential commodities at a cheaper affordable rate.
Taking all these factors together, the government will have to incur an additional expenditure of Rs 1 to 1.5 lakh crore rupees per year over the present expenditure of Rs 3.2 lakh crore rupees on MSP. And this amount is nothing to the central government. Because we know, the government is expending lakhs and lakhs of crore rupees and foregoing substantial revenue earning for the benefit of a handful of monopoly houses and multinationals. Then why should it not spend this meagre amount in the interest of the peasants and common people numbering 130 crores?
In essence, we are proposing two things. One, the government should purchase from the peasants directly at a remunerative price, that is at least one and half times of the production cost (C2) of the agricultural produce. Two, the government must sell the foodgrains and other essential agricultural commodities to the people at a cheaper rate so that the poor people can afford buying them. With everything being handled by the government, there would be no scope for raising the prices of essential commodities artificially by the profit-seeking private operators. And it could well be done in the present capitalist system if the government has a pro-people attitude.
In order to materialise this pro-people planning, the government should prohibit entry of players i.e., capitalists and multinationals—big or small—to enter into the wholesale or retail market of food and essential commodities. Moreover, the government should establish procurement centres within the reach of the peasants and strengthen Public Distribution System (PDS) and other means to sell the foodgrains and essential commodities to the people. And this is what we call ‘‘All out state trading’’. This alone is the surest way, a) to give the peasants MSP for all their produce and, b) to provide common people foodgrains and other necessary agri-products at a cheaper rate. No other option is there. So, the task of the peasant movement at present is to voice the demand—Introduce ‘‘all out state trading’’ to save the peasants and common people.

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