1. In the case of all cereals, pulses and oil-seeds, the procurement at Minimum Support Price (MSP) is unlimited in any State/UT of India.
2. In the case of cereals and pulses, the MSP is fixed in any State/UT at a level to which the market price will never rise.
Which of the statement given above is/are correct ?
Correct Answer: (d) Neither 1 nor 2
Note: Minimum Support Price (MSP) is a form of market intervention by the Government of India to insure agricultural producers against any sharp fall in farm prices. MSPs are currently announced for 24 commodities includes 7 cereals (Paddy, Wheat, Barley, Jowar, Maize, Ragi and Bajra); five pulses (Gram, Arhar/Tur, Moong, Urad and Lentil); 8 oilseeds (Groundnut, Rapeseed/Mustard, Toria, Soyabean, Sunflower, Sesamum, Safflower and Nigerseed), Copra, Cotton, Jute, and De-husked Coconut. Besides these crops, the Government also announces Fair and Remunerative Price (FRP) for Sugarcane.
Even the government announced MSP for 24 crops, MSP related public procurement is largely limited to a few foodgrains such as rice, wheat, and, to a limited extent, pulses. The procurement is also limited to a few States, due to varying land holding size and production of crops. Hence, statement (1) is incorrect.
MSP fixed for each crop is uniform for the entire country. However, there is no instances of MSP is fixed in any state/ UT at a level to which the market price will never rise. Hence, statement (2) is also incorrect.