Why in news?
The Union Agriculture Minister recently approved several procurement proposals under the Market Intervention Scheme (MIS) and the Price Support Scheme (PSS). The decision includes buying 20 lakh metric tonnes (LMT) of potatoes from Uttar Pradesh at a fixed price of ₹6,500.9 per tonne, increasing the ceiling for chana (Bengal gram) procurement to 1,13,250 tonnes in Andhra Pradesh, and extending the purchase of tur (pigeon pea) in Karnataka until 15 May 2026. These measures are aimed at preventing distress sales and ensuring remunerative prices for farmers amid volatile markets.
Background
The Market Intervention Scheme is a component of the Pradhan Mantri Annadata Aay Sanrakshan Abhiyan (PM‑AASHA), launched in 2018 to guarantee fair returns to farmers. MIS operates when states request support for perishable horticultural crops not covered by the Minimum Support Price (MSP). It protects growers of vegetables like tomato, onion and potato from sharp price drops during bumper harvests. According to a government reply in the Rajya Sabha, MIS kicks in when market prices fall at least 10 % below those in a normal year. The procurement limit is generally 25 % of the estimated production, and any losses are shared 50:50 between the Centre and the state (75:25 for northeastern states).
Recent approvals
- Potato procurement in Uttar Pradesh: The central government will buy up to 20 LMT of potatoes at a pre‑fixed market intervention price of ₹6,500.9 per tonne, with an estimated central contribution of ₹203.15 crore. This move aims to stabilise prices and prevent farmers from being forced to sell at throwaway rates.
- Chana procurement in Andhra Pradesh: The ceiling for purchasing Bengal gram under the PSS has been raised from 94,500 tonnes to 1,13,250 tonnes. The higher limit will help farmers dispose of their produce at the MSP without creating gluts in local markets.
- Extension of tur procurement in Karnataka: Farmers will have an extra month, until 15 May 2026, to sell pigeon pea at MSP under the PSS. The extension offers flexibility to farmers coping with logistics and market challenges.
How the Market Intervention Scheme works
- Trigger conditions: MIS is implemented when market prices of perishable crops fall by at least 10 % compared to the previous normal year.
- Procurement limit: The quantity procured is limited to about 25 % of state production to avoid market distortion. Procurement beyond this requires additional approval.
- Cost sharing: Losses incurred from buying and storing produce are shared equally between the central and state governments (or 75:25 for northeastern states).
- Supplementary schemes: PM‑AASHA also includes the Price Support Scheme for pulses, oilseeds and copra at MSP, the Price Deficiency Payment Scheme (PDPS) that pays farmers the difference between market price and MSP for oilseeds, and the Private Procurement and Stockist Scheme (PPSS) for involving private players.
Significance
- Protecting farmer incomes: MIS provides a safety net when gluts cause prices to crash. By assuring purchase at reasonable rates, it discourages distress sales and stabilises farm incomes.
- Reducing food waste: Timely procurement and storage of perishable commodities prevent produce from rotting in fields due to lack of buyers.
- Strengthening federal cooperation: States must formally request MIS intervention and share costs, encouraging joint responsibility and accountability.
Sources: The Hindu
