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Awareness about Minimum Support Price and Its Impact on Diversification Decision of Farmers in India

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  • K.S. Aditya, S.P. Subash, K.V. Praveen, M.L. Nithyashree, N. Bhuvana and Akriti Sharma

Abstract

In this article, we have analysed farmers' awareness about Minimum Support Price (MSP) and its impact on diversification of crops grown in India. We used nationally representative data collected by National Sample Survey Office, 70th round data. The data revealed that only 23.72 and 20.04 per cent of farmers in the rural agricultural households in India are aware of MSP of crops grown by them in kharif and rabi season, respectively. From the results of probit model, it is inferred that MSP needs to be backed up by effective procurement coupled with awareness creation by extension system to enable more number of farmers to take benefit of this safety net. We have also explored the relationship between farmers' awareness about MSP and decision to go for crop specialization using Heckman selection model. The study shows that farmers' knowledge of MSP had not lead to specialization.

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  • K.S. Aditya, S.P. Subash, K.V. Praveen, M.L. Nithyashree, N. Bhuvana and Akriti Sharma, "undated". "Awareness about Minimum Support Price and Its Impact on Diversification Decision of Farmers in India," Asia and the Pacific Policy Studies 201737, Crawford School of Public Policy, The Australian National University.
    • Handle: RePEc:een:appswp:201737
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    1. Ramesh Chandra Das, 2021. "Does Minimum Support Price Have Long-Run Associations and Short-Run Interplays with Yield Rates and Quantities of Outputs? A Study on Food and Non-food Grains in India," Review of Market Integration, India Development Foundation, vol. 13(1), pages 42-65, April.
    2. Shahin Ghaziani & Gholamreza Dehbozorgi & Mohammad Bakhshoodeh & Reiner Doluschitz, 2023. "Identifying Loss and Waste Hotspots and Data Gaps throughout the Wheat and Bread Lifecycle in the Fars Province of Iran through Value Stream Mapping," Sustainability, MDPI, vol. 15(10), pages 1-24, May.
    3. Sukhwinder Singh & Andrew D. Jones & Ruth S. DeFries & Meha Jain, 2020. "The association between crop and income diversity and farmer intra-household dietary diversity in India," Food Security: The Science, Sociology and Economics of Food Production and Access to Food, Springer;The International Society for Plant Pathology, vol. 12(2), pages 369-390, April.
    4. Baul, Tushi & Karlan, Dean & Toyama, Kentaro & Vasilaky, Kathryn, 2024. "Improving smallholder agriculture via video-based group extension," Journal of Development Economics, Elsevier, vol. 169(C).
    5. Jingdong Li & Weidong Liu & Zhouying Song, 2020. "Sustainability of the Adjustment Schemes in China’s Grain Price Support Policy—An Empirical Analysis Based on the Partial Equilibrium Model of Wheat," Sustainability, MDPI, vol. 12(16), pages 1-22, August.
    6. Min Su & Nico Heerink & Peter Oosterveer & Tao Tan & Shuyi Feng, 2021. "Impacts of China’s Minimum Grain Procurement Price Program on Agrochemical Use: A Household-Level Analysis," Agriculture, MDPI, vol. 11(10), pages 1-20, September.
    7. Wei Wang & Chongmei Zhang & Jiahao Song & Dingde Xu, 2021. "The Impact of Target Price Policy on Cotton Cultivation: Analysis of County-Level Panel Data from China," Agriculture, MDPI, vol. 11(10), pages 1-18, October.
    8. Srinivasa, Aditya Korekallu & Praveen, K.V. & Subash, S.P. & Nithyashree, ML & Jha, Girish Kumar, 2021. "Does a Farmer’s Knowledge of Minimum Support Price (MSP) Affect the Farm-Gate Price? Evidence from India," 2021 Conference, August 17-31, 2021, Virtual 315205, International Association of Agricultural Economists.
    9. Singh, Sukhpal, 2019. "Re-organising Agricultural Markets for Doubling Farmer Incomes in India: Relevance, Mechanisms and Role of Policy," Indian Journal of Agricultural Economics, Indian Society of Agricultural Economics, vol. 74(03), July.
    10. Praveen Koovalamkadu Velayudhan & Alka Singh & Girish Kumar Jha & Pramod Kumar & Kingsly Immanuelraj Thanaraj & Aditya Korekallu Srinivasa, 2021. "What Drives the Use of Organic Fertilizers? Evidence from Rice Farmers in Indo-Gangetic Plains, India," Sustainability, MDPI, vol. 13(17), pages 1-13, August.
    11. Trishala Gurung & Avinash Giri & Arun Jyoti Nath & Gopal Shukla & Sumit Chakravarty, 2025. "Assessment of Minimum Support Price for Economically Relevant Non-Timber Forest Products of Buxa Tiger Reserve in Foothills of Eastern Himalaya, India," Resources, MDPI, vol. 14(6), pages 1-14, May.
    12. Morales, Luis Emilio & Balie, Jean & Magrini, Emiliano, . "How has the minimum support price policy of India affected cross-commodity price linkages?," International Food and Agribusiness Management Review, International Food and Agribusiness Management Association, vol. 24(2).
    13. Sabu, Sachu Sara & Kuruvila, Anil & Subash, S.P., 2020. "Price Volatility of Black Pepper in Kerala: Could Institutional Mechanism such as Contract Agreement be a Solution?," Indian Journal of Agricultural Economics, Indian Society of Agricultural Economics, vol. 0(Number 2), April.
    14. Kurup, Suresh A. & Reddy, A. Amarender & Singh, Dharm Raj & Praveen, K.V, 2021. "Risks in Rainfed Agriculture and Adaptation Strategies in India: Profile and Socio-Economic Correlates," 2021 Conference, August 17-31, 2021, Virtual 315127, International Association of Agricultural Economists.
    15. Sourish Das & Sudeep Shukla & Abbinav Sankar Kailasam & Anish Rai & Anirban Chakraborti, 2025. "Predicting and Mitigating Agricultural Price Volatility Using Climate Scenarios and Risk Models," Papers 2503.24324, arXiv.org.

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