It's almost the end of June and the central government is yet to announce the Minimum Support Price (MSP) for kharif crops for the 2018-19 marketing season that starts next month.
There have been instances where MSPs were announced in early July. Though there is no obligation on the part of the government to announce them within a stipulated time, MSPs have acquired an added halo this year since the Centre's promised MSP of 50% over cost of production will come into force from this season.
In reply to a question in Parliament a few years ago, the Central government accepted that though the kharif sowing season starts around May, sometimes there is a delay in the announcement of MSP due to inter-ministerial consultation and soliciting replies from the state government on Commission for Agriculture Costs and Prices (CACP's) MSP recommendations.
The explanation seems logical as there are lots of other ancillary issues are attached with MSP, apart from price.
These include procurement and incidental expenditure for wheat and rice, export market scenario, inter-crop price parity and therefore a broader consultation between various inter-related ministries, be it commerce, finance and others, is done before the final proposal is sent to the Cabinet for approval.
State governments too are taken on board for their views on MSP recommended by CACP. Practically, of the 23 notified crops for which MSP is declared, actual procurement by the government had taken place in just two-three crops in a limited area.
The provision of consultation with the states has further created confusion on MSP. Some state officials said they received a list of kharif MSP, which showed a Rs 80 per quintal increase in case of common grade paddy and a similar hike in case of Grade 'A' paddy.
In pulses, the MSP for toor is proposed to be increased by Rs 400 per quintal to Rs 5,850 per quintal in 2018-19, that of moong by Rs 350 per quintal to Rs 5,925 per quintal and that of urad by Rs 400 per quintal to Rs 5,800 per quintal.
In case of long staple cotton, the MSP is proposed to be raised by Rs 160 per quintal to Rs 4,180, while in case of medium staple cotton it is proposed to be raised to Rs 4,480 per quintal.
However, experts said if this is the final MSP for 2018-19 kharif season, then it remains to be seen what happens to the promise of providing a MSP which is 1.5 times the cost of production.
Or else, what would explain an MSP of common grade paddy which is just Rs 80 per quintal more than last year's MSP where the A2+FL cost of Rs 1,117 per quintal assured a 39% profit over cost.
Noted food policy expert Vijay Sardhana in a recent blog post showed that if the Centre honestly calculates MSP of kharif crops in 2018-19 season to fix it at 50% over cost of production, then for common paddy the kharif MSP should be not less than Rs 1,759 a quintal, for bajra it should be not less than Rs 1,459 a quintal, for arhar it should be somewhere around Rs 5,226 a quintal and for medium staple cotton it should be somewhere around Rs 5,160 a quintal.
This MSP of 50% over cost of production has been calculated by factoring a Consumer Price Index (CPI) inflation of 5 per cent over A2+FL cost of 2017-18.
Now, what exactly would be the kharif MSP of 2018-19 remains a big question.