MINIMUM SUPPORT PRICE & THE QUALITY OF FARM PRODUCTION ASSOCHAM GLOBAL MEET on GREEN REVOLUTION II February 8-9, 2010 Ashok C. Khosla Agribusiness Consultancy

CENTRAL POOL FOOD PROCUREMENT LARGEST INITIATIVE OF ITS KIND IN THE WORLD INDIAS PRODUCTION : WHEAT ~ 78 MMT, RICE ~ 94 MMT POOL PROCUREMENT : WHEAT ~ 12 MMT, RICE ~ 30 MMT STATE FOOD SUPPLY TO MEET SOCIAL OBJECTIVES SUBSIDIZED FOOD FOR THE LESSER–PRIVILEGED PUBLIC DISTRIBUTION SYSTEM BELOW POVERTY LINE & ABOVE POVERTY LINE FOOD SUPPORT SCHEMES

PUBLIC PURCHASE OF FOOD MINIMUM SUPPORT PRICE MINISTRY OF AGRICULTURE COMMISSION FOR AGRICULTURAL COSTS & PRICES COST ESTIMATION BASIS : C2 COST INPUTS, LABOUR, LAND USE FIELD DATA: A NETWORK OF AGRICULTURAL UNIVERSITIES LATEST STATISTICS POSTED :

THE GREEN REVOLUTION IN PUNJAB - 1 WHEAT PRODUCTION & WHEAT MSP

THE GREEN REVOLUTION IN PUNJAB - 2 THE C2 COST OF WHEAT PRODUCTION – Rs./Qtl

THE GREEN REVOLUTION IN PUNJAB - 3 FARMING PROFITABILITY FOR WHEAT & RICE AVERAGE FARM SIZE IN PUNJAB = 1 ha ANNUAL MSP INCOME FROM WHEAT & RICE = Rs ,884 VARIABLE COSTS AS DETERMINED BY CACP = Rs ,830 AVERAGE FARM FAMILY INCOME = Rs ,014 AVERAGE RURAL HOUSEHOLD SIZE (PER NSSO) = 4.8 persons PER CAPITA ANNUAL FARM INCOME = Rs.... 7,711 PER CAPITA FARM INCOME PER MONTH = Rs FARMERS GROWING MSP CROPS ARE BECOMING BPL THEMSELVES IS NREGA A BETTER OPTION THAN FARMING MSP CROPS?

THE GREEN REVOLUTION IN PUNJAB PERMANENT MANDIS & 1650 SEASONAL MANDIS PEAK PADDY ARRIVALS ARE 800,000 MT EACH DAY MANUAL DRYING OUT OF PADDY AT THE MANDIS

THE FUTURE FACE OF MSP AFTER 30 YEARS, NEW TERMS OF REFERENCE FOR CACP CACP C2 COSTS STRUCTURES TO NOW PROVIDE FOR: PRODUCERS TO BE SPECIALLY INCENTIVIZED MARKETING, INSURANCE, OTHER COSTS INCULCATION OF NEW TECHNOLOGY FAIR & REMUNERATIVE PRICES

THE GREEN REVOLUTION - II THE SECOND GREEN REVOLUTION HAS TO BE A QUALITY REVOLUTION FIRST - BRING QUALITY TO WHAT WE ARE PREPARED TO PAY FOR IT SECOND - BRING QUALITY TO HOW WE SHOULD BE FARMING IT THIRD - BRING QUALITY TO HOW WE HANDLE & STORE IT