Farmer leader Sarwan Singh Pandher on Saturday insisted that the Centre should enact an ordinance to ensure a legal guarantee for Minimum Support Price (MSP), a pivotal demand of the farmers currently encamped at the Shambhu and Khanauri points of the Punjab-Haryana border. This demand arises on the eve of the fourth round of discussions between farm leaders and Union ministers concerning their array of demands.
In addition to the MSP’s legal assurance, the farmers are advocating
for the implementation of the Swaminathan Commission’s recommendations, provision of pension for farmers and farm laborers, forgiveness of farm debts, prevention of electricity tariff hikes, withdrawal of police charges, and “justice” for the victims of the 2021 Lakhimpur Kheri violence. Further demands include reinstatement of the Land Acquisition Act of 2013, and compensation for families of farmers who perished during the previous agitation in 2020-21.
What benefits will farmers receive with MSP?
Farmers nationwide are calling for an ordinance to ensure a legal guarantee for MSP. MSP provides farmers with a minimum price for their crops, ensuring they have a stable income and shielding them from market price swings. 
It also stabilizes agricultural product prices, preventing drastic changes and ensuring reasonable prices for consumers. By offering farmers a fair price for their produce, MSP encourages them to boost agricultural production. Additionally, MSP encourages farmers to grow staple crops, reducing the need for imports and bolstering domestic food security.
Farmers across India frequently find themselves receiving prices for their crops that fall below the officially declared MSP. Due to the absence of legal support for MSPs, farmers are unable to enforce these prices as a guaranteed right.
The government’s procurement of crops at MSP is limited, with only approximately one-third of wheat and rice crops, and 10% to 20% of selected pulses and oilseeds being purchased at MSP rates. As a result, the majority of farmers are unable to avail themselves of this benefit.
Challenges with MSP
Legalizing MSP presents challenges, as a fixed predetermined price may discourage private traders from participating during periods of excess production and declining market prices. This could result in the government becoming the primary buyer of most crops, an unsustainable approach. 
Moreover, legalizing MSP could elevate the risk of corruption and improper distribution or diversion of crops from warehouses, ration shops, or during transportation. While selling cereals and pulses through the public distribution system is relatively straightforward, it becomes more complex to manage crops like niger seed, sesamum, or safflower.
Additionally, if MSP prices surpass prevailing international rates, it could negatively impact India’s agricultural exports, which currently contribute 11% to total commodity exports. Furthermore, higher procurement costs under MSP could lead to increased prices of food grains, causing inflation that would ultimately affect the poor.
