In a significant move that has brought relief to the farming community in Punjab, the Food Corporation of India (FCI) and state agencies have procured 85.41 lakh metric tonnes (LMTs) of paddy during the ongoing kharif marketing season of 2024-2025. This procurement, as of November 2, has been confirmed by a statement issued by the Union Food Ministry.

The procurement process, which is in full swing, has seen the Centre disburse a whopping Rs 19,800 crore, benefiting approximately 4 lakh farmers in Punjab. This is a significant development considering the state agencies also procure paddies on behalf of the Centre, leveraging their warehousing facilities.

As per the official statement, As of 2nd November 2024, a total quantity of 90.69 LMT of paddy has arrived in the Punjab mandis. Out of this, 85.41 LMT have been procured by state agencies and FCI.

Paddy Procurement and MSP

The paddy is being purchased at the Minimum Support Price (MSP) of Rs 2320 per quintal, a rate decided by the Government of India for Grade 'A' paddy. The procurement process has seen a significant number of millers apply for shelling of paddy. Out of 4,640 millers who applied, 4,132 have already been allotted work by the Punjab government. This is a clear indication of the scale of operations and the level of involvement from various stakeholders in the process.

The procurement for the 2024-25 marketing season commenced in Punjab from October 1. To ensure smooth procurement from the farmers of Punjab, 2,927 designated mandis and temporary yards have been made operational throughout the state.

The Central government has set an ambitious target of 185 LMT for paddy procurement for the ongoing kharif marketing season, which will continue up to November 30. Despite a late start due to heavy rains in September and high moisture content in paddy, the procurement process is back on track and has picked up in full swing.

Impact of MSP on Farming Community

The MSP is a critical component of the procurement process. It is the price fixed by the Centre at which it buys foodgrains from the farmers. The aim is to ensure that farmers get a profitable return and do not have to resort to distress sales. This price is announced before the sowing season, enabling farmers to choose their cropping pattern accordingly.

In a related development last month, the Union Cabinet announced an increase of up to 7 per cent in the MSPs of rabi crops such as wheat. These crops are being sown now for the 2025-26 marketing season that will start from April. The support price of wheat has been hiked by 6.59 per cent and fixed at Rs 2,425 per quintal from Rs 2,275 per quintal in the marketing season 2024-25.

This move by the government is reminiscent of similar initiatives in the past where the MSP has been used as a tool to ensure farmers get a fair price for their produce. For instance, in 2018, the government had announced a significant increase in the MSP for Kharif crops, a move that was aimed at fulfilling its promise of giving farmers 1.5 times the cost of production.

In conclusion, the procurement of paddy in Punjab is a significant development that has brought relief to the farming community. The government's decision to increase the MSP for rabi crops is also a positive step towards ensuring the profitability of farmers. However, it remains to be seen how these measures will impact the overall agricultural scenario in the country in the long run.