Paddy farmers face ₹3.07 lakh crore loss; Samyukta Kisan Morcha calls nationwide protests
The Samyukta Kisan Morcha (SKM), an umbrella body of farmer organisations, called nationwide protests demanding a statutory guarantee for Minimum Support Price (MSP)
The demand centres on fixing MSP using the C2+50% cost formula for paddy and other major crops, with paddy MSP for 2026-27 sought at ₹3,243 per quintal
SKM cited cumulative losses to paddy farmers of ₹3.07 lakh crore, attributed to MSP being fixed below the C2+50% benchmark and gaps in procurement
The protests also raised demands around assured procurement, farm loan waivers and repeal of certain Free Trade Agreement provisions affecting agriculture
The Union government's actual paddy MSP for the 2026-27 kharif marketing season was fixed at ₹2,441 per quintal (common grade) and ₹2,461 per quintal (A-grade), roughly 50% above the A2+FL cost of production
Minimum Support Price (MSP) — Mechanism and Legal Status
MSP is the floor price at which the government commits to purchasing designated crops from farmers, intended to protect them from price crashes and input-cost volatility. It is a policy instrument, not a legally enforceable right — no statute currently obligates the government to purchase every unit offered at the announced MSP, which is the core of the "legal guarantee" demand.
Key Details
- The Commission for Agricultural Costs and Prices (CACP), an attached office of the Ministry of Agriculture and Farmers Welfare, recommends MSP for 22 mandated crops (14 kharif, 6 rabi, plus copra and jute) based on cost of production, demand-supply, domestic/international prices, and inter-crop price parity
- MSP is formally approved by the Cabinet Committee on Economic Affairs (CCEA)
- Since 2018-19, the government's stated policy has been to fix MSP at a minimum of 1.5 times (150%) the All-India weighted average A2+FL cost of production — not the C2 cost
- Procurement is operationalised mainly through the Food Corporation of India (FCI) and state agencies, chiefly for rice and wheat; MSP-based purchase for most other crops remains limited
SKM's demand of ₹3,243 per quintal for paddy is well above the government-declared ₹2,441 (common grade), reflecting the gap between the A2+FL-based 1.5x formula the government uses and the C2+50% formula farmer groups are demanding, alongside a call to make MSP legally binding.
C2+50% Formula — Swaminathan Commission Recommendation
The National Commission on Farmers (NCF), chaired by M.S. Swaminathan (2004-06), recommended that MSP be fixed at least 50% above the comprehensive cost of production (C2), aiming to secure a minimum net income for farmers rather than merely covering input costs.
Key Details
- A2 cost: actual out-of-pocket expenses paid by the farmer (seeds, fertiliser, pesticides, hired labour, fuel, irrigation charges)
- A2+FL: A2 plus the imputed value of unpaid family labour
- C2 cost: the most comprehensive measure — A2+FL plus imputed rent on owned land and interest on owned fixed capital (machinery, farm buildings)
- The government's current formula (1.5x A2+FL) yields a lower MSP than the Swaminathan Commission's proposed 1.5x C2, since C2 includes land rental and capital costs that A2+FL excludes
- The NCF submitted five reports between 2004 and 2006; the C2+50% recommendation has been a recurring demand since the 2020-21 farm laws protests
The gap between the government's A2+FL-based MSP and SKM's C2+50%-based demand explains the large difference between the official ₹2,441/quintal paddy MSP and SKM's demanded ₹3,243/quintal.
Samyukta Kisan Morcha and the Farm Laws Protests
SKM is a coalition of farmer unions formed in 2020 to coordinate opposition to the three farm laws — the Farmers' Produce Trade and Commerce Act, the Farmers (Empowerment and Protection) Agreement Act, and the Essential Commodities (Amendment) Act. The three laws were repealed by Parliament in November 2021 via the Farm Laws Repeal Act, 2021, after which the government committed to forming a committee on MSP legal guarantee — a commitment farmer groups say remains unfulfilled, which underlies recurring protests including this one.
Key Details
- The 2020-21 protests, centred on Delhi's borders (Singhu, Tikri, Ghazipur), lasted roughly a year before repeal
- A committee to examine MSP legal guarantee, natural farming, and crop diversification was promised in 2021 but farmer bodies have repeatedly flagged delays and inadequate representation in it
- SKM has since organised periodic protests (e.g., "Jail Bharo", nationwide protest days) over MSP, loan waivers, and trade agreement concerns
This protest is a continuation of SKM's post-repeal campaign for a statutory MSP guarantee, now specifically framed around paddy losses ahead of the 2026-27 kharif marketing season.
- SKM's cited paddy farmer loss: ₹3.07 lakh crore
- SKM's demanded 2026-27 paddy MSP: ₹3,243 per quintal (C2+50% basis)
- Government's actual 2026-27 kharif paddy MSP: ₹2,441/quintal (common), ₹2,461/quintal (A-grade)
- Government's MSP formula since 2018-19: 1.5× A2+FL cost (not C2)
- CACP recommends MSP for 22 crops; CCEA gives final approval
- Three farm laws repealed via the Farm Laws Repeal Act, 2021