Abstract

The study evaluates the efficiency of the Minimum Support Price on paddy cultivation in Punjab. The data spanning from 1996–1997 to 2019–20 on area, production, yield, cost of production, operational cost, different cost components, and MSP of paddy in Punjab were collected from the secondary sources. For this study, data were collected from the Directorate of Economics and Statistics and the Commission for Agricultural Costs and Prices (CACP) underneath the Ministry of Agriculture and Farmers Welfare, Government of India. The descriptive statistics and the Compound Annual Growth Rate (CAGR) were used to analyze the collected data with appropriate analytical tools. The study exposed that the area and production of paddy has significantly increased over the year, whereas the yield has decreased. The findings of the study shows that the relative share of the different inputs, adequacy of the MSP in meeting the cost of production, and the percentage difference between the MSP and different cost components have significantly increased over the period. Therefore, the outcome of the study revealed that the MSP has significantly increased and the MSP for paddy to be found very effective in Punjab state.

Keywords: MSP, Cost of Production, Paddy Cultivation, Sustainable Agriculture, Punjab