RAS question
MSP is recommended by which body?
Correct answer: (A) Commission for Agricultural Costs and Prices (CACP).
Minimum Support Price is recommended by the Commission for Agricultural Costs and Prices, while the Government fixes MSP on the basis of those recommendations.
Explanation
MSP is linked to CACP because the Government fixes Minimum Support Price on the basis of recommendations made by the Commission for Agricultural Costs and Prices. CACP weighs major inputs such as cost of production, demand-supply conditions, inter-crop price parity, market prices and international prices. The Press Information Bureau release also supports the cost side clearly: CACP considers both A2+FL and C2 costs while recommending MSP, reckons A2+FL for return, and uses C2 mainly as a benchmark reference cost. Since 2018-19, MSP follows the principle of being at least 1.5 times the A2+FL cost, which is why the recommending body, not a procurement agency or planning body, is the key fact tested here.
Why the other options are wrong
- (B) NITI Aayog is not the MSP-recommending body; the Press Information Bureau release assigns the recommendation role to CACP.
- (C) The Ministry of Agriculture does not directly recommend MSP; MSP is fixed by the Government on the basis of CACP recommendations.
- (D) Food Corporation of India is linked with procurement, but the recommendation of MSP is attributed to CACP, not FCI.
Concept
This tests the agricultural price policy part of Indian Economy, especially the institutional role behind MSP. It recurs in RAS because MSP questions often mix up recommendation, fixation and procurement agencies.