Question

Which of the following are the chief objectives of setting up the MSP?

• A. To support farmers from distress sales
• B. To create a government monopoly in the sale of foodgrains
• C. To procure foodgrains for public distribution
• D. To take away the profits of farmers

Answer 1

Answer: (A), (C)

To procure foodgrains for public distribution

Every year, the MSP is declared by the government before the sowing season. It acts as an incentive for farmers to grow more crops. The surplus foodgrains are then purchased by the FCI and stored in granaries. This supports the farmers from distress sales and helps the government procure foodgrains for public distribution.