Correct option is C
The correct answer is (c) It continued to protect farmers from price fluctuations.
Explanation:
- After the 1991 Economic Reforms, which focused on liberalization, privatization, and globalization, the Minimum Support Price (MSP) system was retained to ensure a safety net for farmers.
- It continued to protect them from sudden price drops in the open market by guaranteeing a minimum price for their produce, especially for key crops like wheat and rice.
Information Booster:
Minimum Support Price (MSP):
What is MSP?
- MSP is the minimum price guaranteed by the government to farmers for their crops, regardless of market prices.
- Aims to protect farmers from price fluctuations and distress sales.
- Introduced during the Green Revolution (1966-67).
Purpose of MSP:
- Ensures fair remuneration to farmers.
- Encourages production of essential food crops.
- Maintains food security and agricultural sustainability.
Who Recommends MSP?
- Commission for Agricultural Costs and Prices (CACP) recommends MSP.
- Final approval is given by the Cabinet Committee on Economic Affairs (CCEA).
When is MSP Announced?
- Twice a year:
- Before Kharif season (monsoon crops)
- Before Rabi season (winter crops)
Crops Covered Under MSP (Total: 22 + 2 linked)