NITI Aayog Member Ramesh Chand said there is a case for making minimum support price for crops legal in case the open market price is higher than the government offered MSP.
The government recently formed a 29-member committee to provide transparency on MSP. Chand said that the committee may also suggest other ways to provide MSP apart from physical procurement which will reduce the government cost greatly. He said that its coverage can be increased if the government pays the price difference between the open market price and the MSP.
For every MSP of Rs 100 for wheat, the procurement cost to govt is approx Rs 35.
Chand said that if the global input prices continue to rise, the government can consider giving bonuses for next season instead of revision in the MSP.
On the ongoing wheat export ban, he said that we should not look at removing wheat exports as global prices continue to trend higher.
On the high edible oil prices, Chand said that in 3-4 months, edible oil prices may return to normal levels. The government needs to continue with reduced duties on edible oil imports this year to control inflation. The case for continued liberal imports as pressure on edible oil prices continues, he said.
He also said that a committee of secretaries is reviewing edible oil prices every week.
He added that next year if the edible oil prices return to normal levels, then the import duties may be levied on edible oil to provide an impetus to increase acreage for oilseed sowing.
