The Indian government has approved a significant increase in the Minimum Support Prices (MSP) for 14 Kharif crops for the 2025–26 marketing season, a move aimed at boosting farmers’ incomes and ensuring price security. The decision was taken by the Cabinet Committee on Economic Affairs (CCEA) chaired by Prime Minister Narendra Modi.
Key Announcements:
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The highest MSP hike is for nigerseed, which sees an increase of ₹820 per quintal.
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Other notable hikes:
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Ragi: up by ₹596 per quintal
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Cotton: up by ₹589 per quintal
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Sesamum: up by ₹579 per quintal
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What is MSP?
MSP is the minimum guaranteed price the government offers to farmers for their crops, even if market prices fall below this level. It ensures fair and stable income for farmers and reduces their dependence on market fluctuations.
Policy Foundation:
The MSP increase follows the Union Budget 2018–19 policy, which promised that MSPs would be at least 1.5 times the average cost of production. This guarantees farmers a minimum profit margin of 50% or more over their investment in cultivating these crops.
Projected Profit Margins (2025–26):
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Bajra (Pearl Millet): 63%
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Maize: 59%
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Tur (Arhar Dal): 59%
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Urad (Black Gram): 53%
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Other crops: ~50% margin
This data shows that coarse grains and pulses remain focus areas for higher profitability, encouraging diversification beyond traditional cereals like rice and wheat.
Government’s Push for Crop Diversification:
The MSP hike aligns with the government's long-term goal to promote pulses, oilseeds, and millets—categorized as Nutri-cereals or Shree Anna—to improve both nutritional outcomes and agricultural sustainability.
Comparison with UPA Era (2004–05 to 2013–14):
| Metric | 2014–15 to 2024–25 | 2004–05 to 2013–14 |
|---|---|---|
| Paddy procured | 7608 LMT | 4590 LMT |
| Total Kharif crops procured | 7871 LMT | 4679 LMT |
| MSP paid for paddy | ₹14.16 lakh crore | ₹4.44 lakh crore |
| MSP paid for all 14 crops | ₹16.35 lakh crore | ₹4.75 lakh crore |
These figures reflect a massive jump in procurement volumes and financial outlays under the Modi government compared to the previous UPA era.
In Summary:
This decision to hike MSPs:
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Reinforces the government’s commitment to farmers’ welfare
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Encourages diversified, resilient, and nutritious farming
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Seeks to deepen agricultural reforms without rolling back state support
With rising input costs and climate uncertainties, this strategic MSP boost is a critical step to ensure financial security for farmers and to promote sustainable agricultural practices across India.
