Cabinet increases support price for farmers, allowance for government employees, pensioners. peppermint

New Delhi: The Union Cabinet on Wednesday approved increase in support price of agricultural produce and allowances for employees and pensioners with an aim to reduce the impact of inflation ahead of Diwali. The government also approved additional rail lines for two districts of Uttar Pradesh.

Minimum support price (MSP) cost for winter (Rabi) crops approved on Wednesday 87,657 crores. Provision has been made for this in the Union Budget 2 trillion food subsidy for the current financial year.

Union Minister Ashwini Vaishnav said in a briefing that the significant increase in the support price of Rabi crops for the 2025-26 marketing season was decided on the advice of an expert panel keeping in mind the need to ensure remunerative prices for farmers, Demand- supply situation and its impact on the economy.

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The additional installment of ‘Dearness Allowance’ to Central Government employees and ‘Dearness Relief’ to pensioners is 3% more than the existing 50% of basic pay or pension. This increase will put additional burden on the government treasury An official statement said this amounts to Rs 9,448.35 crore annually.

This will benefit about 49 lakh central government employees and about 65 lakh pensioners. The increase in allowance is based on the recommendation of the Seventh Central Pay Commission, to protect the recipient from the impact of inflation.

These decisions come ahead of Maharashtra and Jharkhand state assembly elections in November, but Vaishnav said they have nothing to do with the elections and MSP is always announced in the Rabi season and dearness allowance and relief are always announced during Dussehra and Is released around Diwali.

The Union Cabinet also approved a railway project for capacity expansion in Varanasi and Chandauli districts of Uttar Pradesh 2,642 crores.

The MSP for six Rabi crops – wheat, barley, gram, masoor/lentil, rapeseed/mustard and safflower – has been increased so that the margin on the cost of production is in the range of 50-105%.

The minister said, this decision is for the welfare of the farmers. “That is why there is huge support for the government policies among the farming community.”

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Siraj Hussain, former secretary to the government in the Department of Agriculture and Farmers Welfare, said there is a clear need to protect the minimum support price of chana (gram), lentils and mustard.

“Farmers did not get MSP for mustard in the open market in the last Rabi. I hope they will get it this year because the duty on edible oils has been increased,” said Hussain.

Hussain pointed out that in the last Rabi season, market prices were below the MSP due to excessive import of edible oils as the duty was relaxed before the imposition of 20% import duty from September 13. He said that the purchase of mustard was also limited.

Rapeseed and mustard saw the highest increase in MSP in absolute terms 300 per quintal. This increase is particularly significant, reflecting the government’s intention to boost domestic oilseed production and reduce dependence on edible oil imports. After this, an increase in the crop of lentils was seen 275 per quintal, to boost pulse production to meet India’s domestic nutritional needs.

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Wheat, a major staple crop, experienced moderate increase in MSP 150 per quintal, offering farmers 105% margin on production cost. This ensures that wheat remains a priority crop while maintaining profitability for producers. Meanwhile, an increase was seen in gram 210 per quintal, while barley and safflower saw an increase 130 more 140 per quintal respectively.

The increase in MSP is in line with the commitment made in the Budget 2018-19 to set the MSP at 1.5 times the all-India weighted average cost of production.

According to Agriculture Ministry data, the production of pulses in the country has declined from 27.3 million tonnes in FY 2012 to 26 million tonnes in FY 2013 and 24.5 million tonnes in FY 2014.

According to the Ministry of Consumer Affairs, pulses imports have increased significantly in recent years, increasing by 44% from 2.07 million tonnes in calendar year 2023 to 2.99 million tonnes in 2022.