Consider the following statements:
- 1.In the case of all cereals, pulses and oil-seeds, the procurement at Minimum Support Price (MSP) is unlimited in any State/UT of India.
- 2.In the case of cereals and pulses, the MSP is fixed in any State/UT at a level to which the market price will never rise.
Which of the statements given above is/are correct?
Answer & explanation
Answer: (d) Neither 1 nor 2
Neither statement is correct. The Government buys at MSP in approved quantities, not unlimited amounts of every crop in every State, and MSP is only a floor: it is the price at which the Government agrees to buy, so market prices can rise above it.
- ✗ 1. Procurement is planned and approved in specified quantities. For example, in Kharif Marketing Season 2019-20 the Government approved procurement of 3,49,250 tonnes of coarse grains, so buying at MSP is not unlimited for all cereals, pulses and oilseeds in every State or UT. Today's rule (PIB): under the Price Support Scheme, procurement of notified pulses, oilseeds and copra is sanctioned up to 25% of a State's production at first, with the ceiling lifted only for some pulses such as tur, urad and masur.
- ✗ 2. A support price helps ensure a minimum income to farmers because it is the price at which the Government agrees to buy. It is a floor, not a ceiling, so open-market prices can and do rise above MSP.
Remember · MSP is a floor price at which the Government agrees to buy, not a ceiling, and it does not mean unlimited buying of every crop in every State.
📘 Read it in NCERT: Class 12 Indian Society, Ch 4 (practise this chapter)
Sources
- NCERT Class 12 · Indian Society, Chapter 4 “Support prices help to ensure a minimum income for farmers because they are the prices at which the government agrees to buy agricultural commodities.”
- Economic Survey 2019-20, Volume 2, Chapter 7 Agriculture and Food Management ↗ “(iii) During the KMS 2019-20, procurement of 3,49,250 Metric Tonnes (MT) of coarse grains was approved.”
- PIB, Ministry of Agriculture and Farmers Welfare: Empowering Farmers Through PM-AASHA (Price Support Scheme, 2024-25 onwards) ↗ “the sanction for the procurement of notified Pulses, Oilseeds and Copra under PSS are given to the State/UT initially up to a maximum of 25% of the production of the State for that particular season.”
Question and answer: UPSC's official GS Paper I (2020, Series A) — paper ↗ · answer key ↗. Explanation: Minimalist IAS, checked 30 Sept 2026 (how we verify). ·