Which of the statements given below is/are correct ? 1. For the mar

Which of the statements given below is/are correct ?

  • 1. For the marketing year 2014 – 2015, the minimum support price (MSP) for wheat in India has been fixed at Rs. 1,400 / quintal
  • 2. MSP is the rate at which the government sells the grains through the fair price shops

Select the correct answer using the code given below :

1 only
2 only
Both 1 and 2
Neither 1 nor 2
This question was previously asked in
UPSC CAPF – 2014
Statement 1 is correct. For the marketing season 2014-2015 (which corresponds to the Rabi crops harvested in 2014, including wheat), the Minimum Support Price (MSP) for wheat was fixed by the government at Rs. 1,400 per quintal. Statement 2 is incorrect. MSP is the price at which the government *purchases* crops from farmers to protect them from market price fluctuations. The government sells food grains through fair price shops under the Public Distribution System (PDS) at *subsidised* issue prices, which are much lower than the MSP.
MSP is a procurement price set by the government to buy from farmers.
The government sells food grains through fair price shops at subsidised prices.
The MSP for wheat for the 2014-15 marketing season was Rs. 1400/quintal.
The MSP is announced by the government based on the recommendations of the Commission for Agricultural Costs and Prices (CACP). The PDS is a system for distributing subsidised food and non-food items to India’s poor.
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