Previous Year Question
Which of the following makes recommendations regarding fixing of minimum support price for various crops?
Indian Council of Agricultural Research
NABARD
Commission for Agricultural Costs and Prices
Indian Agricultural Research Institute
Correct Answer: C
Detailed Solution
In India, the CACP is the institution that recommends Minimum Support Prices (MSPs) for various agricultural crops to the Central Government. The final MSP is announced/fixed by the Government of India after considering the recommendations of the CACP as well as the views of concerned States and Central Ministries.
The CACP was established in 1965 as the Agricultural Prices Commission. It was subsequently renamed the Commission for Agricultural Costs and Prices in 1985.
While recommending MSPs, the CACP considers not only the cost of production but also the overall demand-supply situation, domestic and international prices, inter-crop price parity, terms of trade between agricultural and non-agricultural sectors, likely impact on the economy and rational utilisation of resources such as land and water.
Under the present framework, the Government fixes MSPs for 22 mandated agricultural crops on the basis of CACP recommendations. In addition, the Fair and Remunerative Price (FRP) for sugarcane is also fixed on the basis of CACP recommendations.
CACP → Recommends MSP
Government of India → Finalises and announces MSP