At a time when the Union government is scrambling to fix its rural agenda, it has declared inclusion of 17 new minor forest produce (MFP) under the government’s minimum support price scheme.
The new MFP under the scheme includes Mahua flowers (dried), Tejpatta (dried) and Kokum (dry). On December 27, the ministry of tribal affairs made the announcement, while also increasing the MSP of MFPs already included in the scheme since 2013.
The new MFP under the scheme includes Mahua flowers (dried), Tejpatta (dried) and Kokum (dry).
The Pricing Cell, constituted by the Tribal Cooperative Marketing Development Federation of India Ltd (TRIFED), recommended the inclusion of new MFPs under the scheme, given their importance to the economy of local communities.
A Planning Commission report had noted that MFP contributes to 20 to 40 per cent of the income of forest-dependent communities, especially the landless with a dominant population of tribals, and “provides critical subsistence during lean seasons.”
The MFP economy, however, is also known to suffer from unorganised and uncertain market demands, affecting economic returns to these communities.
In theory, an MSP is a minimum price set by the Government at which farmers can expect to sell their produce for the season. When market prices fall below the announced MSPs, procurement agencies step in to procure the crop and ‘support’ the prices.
The Cabinet Committee of Economic Affairs announces MSP for various crops at the beginning of each sowing season based on the recommendations of the Commission for Agricultural Costs and Prices (CACP). The CACP takes into account demand and supply, the cost of production and price trends in the market among other things when fixing MSPs.
Price volatility makes life difficult for farmers. Though prices of agri commodities may soar while in short supply, during years of bumper production, prices of the very same commodities plummet. MSPs ensure that farmers get a minimum price for their produce in adverse markets. MSPs have also been used as a tool by the Government to incentivise farmers to grow crops that are in short supply.