On Wednesday, it is declared that there is a new procurement policy approved by the cabinet. According to this policy, one scheme will focus on recompense oilseeds farmers if the rates drop below the MSP and a further will agree to states to rope in private players for procurement, sources said

The meeting was headed by the Prime Minister Narendra Modi regarding the decision which was taken by the cabinet on Wednesday.

According to the budget this year, the government had declared that it will ensure that the farmers are getting at least minimum support price (MSP). It had asked from Niti Aayog to suggest a device in after the discussion with the union agriculture ministry and states.

As per the sources, The agriculture ministry’s proposal on new procurement policy ‘Annadata Maulya Samrakshana Yojana’ was engaged for the dialogues in the cabinet and it has been approved also.

The new policy which was implemented on Wednesday states that the state governments will be getting an option to choose multiple schemes considering that they can protect farmers if the prices drop below the MSP.

A new scheme ‘Price Deficiency Payment (PDP)’ has been started on the lines of Madhya Pradesh government’s Bhavantar Bhugtan Yojana (BBY) the scheme formed just to protect oilseeds farmers only.

According to PDP, the farmers will get the difference between the MSP and monthly average price of oilseeds which was the same as the actual price quoted in the wholesale market and the amount will be paid by the government. This would be executed for up to 25 per cent of the oilseeds production in a state. Apart from this, all states are getting the choice to rope in the private players for oilseeds procurement on a pilot basis.

According to the sources Both PDP and private players’ are taking place exclusively for oilseeds because the government wants to cut down the cost of the country’s import of cooking oils.

According to the new policy, if the prices will drop down below the MSP than the states will also be given an option to opt for the existing Price Support Scheme (PSS), under which central agencies acquire produce covered.

The sources further added that “The states can opt one from either PSS or PDP or engage private players in procurement to ensure MSP to farmers”.

India import near about 14-15 million tons of edible oils annually, which comes around 75 per cent of the domestic demand.