This year’s 16 per cent rise in the Minimum Support Price (MSP) for paddy is unlikely to cheer farmers in West Bengal, one of the biggest rice producing states. Output is likely to come down by at least 10-15 per cent this year, on account of an ongoing dry spell and a distress sale last season.
Yesterday, the government raised the MSP for paddy from Rs 1,080 per quintal last year to Rs 1,250 per quintal for 2012-13.
Eastern India is yet to receive monsoon rains due to persistence of a large mass of dry air over the western Bay of Bengal. The monsoon generally arrives by the first week of June in the state, which triggers the paddy sowing season.
“There is already a delay in sowing. Also, the area under cultivation has come down from around 1.5 million hectares to 900,000 hectares,” said Pranab Chatterjee, director of farms, Bidhan Chandra Krishi Viswavidyalaya.
Farmers were discouraged after the price of paddy in the domestic market had crashed to Rs 850-900 per quintal, against the MSP of Rs 1,080 per quintal, due to a bumper crop. Earlier this year, better quality rice from the neighbouring states of Jharkhand and Bihar had flooded the markets, leading to a price crash.
In addition, fertiliser prices had doubled over the past year, and the cost of paddy production has risen to Rs 1,000 per quintal.
The state produces about 14.5 million tonnes of paddy every year in three seasons — aus, aman and boro. Rice production during the boro or winter is about 4.5 mt.
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The other two are cultivated in the summer or kharif season, and the total area under cultivation normally comes to 5.9 mha. West Bengal contributes 14-16 per cent of India's rice production.
Critics are rapping the procurement policy. The government had recently announced it would transfer the support price directly to farmers’ through account payee cheques.
The idea was to eliminate the intervention of middlemen in lifting paddy and forcing farmers to open bank accounts. However, this also means farmers have to bear the cost of transportation of paddy and handle delays in getting payment.