The Cabinet Committee on Economic Affairs (CCEA), chaired by Prime Minister Narendra Modi, has approved a significant increase in the Minimum Support Prices (MSP) for all mandated Rabi crops for the 2025-26 marketing season. This move aims to provide remunerative prices for farmers and promote crop diversification. The government’s decision ensures that the MSP aligns with the Union Budget 2018-19’s goal of setting MSPs at least 1.5 times the All-India weighted average cost of production.
The highest absolute increase in MSP is for rapeseed and mustard, which has risen by Rs 300 per quintal, bringing its MSP to Rs 5,950 per quintal. Lentils (masur) have seen an increase of Rs275 per quintal, with the new MSP set at Rs 6,700 per quintal. Gram, wheat, safflower, and barley have also experienced notable increases in their MSPs, rising by Rs 210, Rs 150, Rs 140, and Rs 130 per quintal, respectively.
The government’s MSP decision covers a range of costs incurred by farmers, such as hired labor, machine labor, land rent, seeds, fertilizers, irrigation expenses, depreciation of farm buildings and equipment, working capital interest, diesel and electricity for irrigation, and family labor. This comprehensive approach to calculating production costs ensures that farmers receive a fair return on their investment.
The new MSP rates for wheat stand at Rs 2,425 per quintal, providing a margin of 105% over the cost of production, which is calculated at Rs 1,182 per quintal. Barley’s MSP has been raised to Rs1,980 per quintal, with a margin of 60%. Gram will now be sold at Rs 5,650 per quintal, offering a 60% margin. Lentils and rapeseed & mustard will bring margins of 89% and 98%, respectively, over their production costs. Meanwhile, safflower’s MSP has increased to Rs 5,940 per quintal, with a margin of 50% over the production cost.
This increase in MSP is expected to incentivize farmers to cultivate a variety of crops and diversify their production, reducing dependency on a few staple crops. Moreover, it will ensure that farmers are compensated fairly for their efforts, thereby boosting agricultural growth and stability in India.
