Explained: How Does Punjab Procure More Paddy at MSP than it Produces?

Punjab purchases millions of tonnes of paddy from neighbouring states. This is how Punjab is procuring more paddy at MSP than it produces.

Several exporters and rice millers in Bihar and UP have been reported procuring paddy at Rs 900 to Rs 1,200 per quintal. It costs them around Rs 1,200 to Rs 1,500 per quintal, including all transportation costs. They earn around Rs 400 to 600 by selling it illegally in the name of farmers in Punjab Mandis at an MSP of Rs 1,888 per quintal.

Punjab Farm Laws

To put an end to farmers’ rage in the state, the Punjab state assembly has passed new farm bills. The bills will provide MSP as a legal right to farmers. It reads that sale and purchase of wheat and paddy will not take place below the Minimum Support Price (MSP) announced by the Central Government. Also, the bill explains that if any person or company or any other association of people exerts pressure on farmers to enter into a contract or sell below MSP, it will be a punishable offence. This shall lead to term imprisonment of not less than three years and a fine.

Stopping Paddy Coming from Other States

Farmers in Punjab attributed the influx of basmati from other states to a fall in rates. Farmers Union stopped several trucks carrying basmati to Punjab near the Punjab-Haryana border. The growers complain that only private traders procure basmati. Further, they said that private traders are taking away farmers’ profits by buying the produce at a low price and selling it at high rates in international markets. While they sold PUSA 1509 at Rs 2,500-2,700 per quintal last year, the rates have come down to Rs 1,600 this year. 

To this, a rice exporter said that why they should pay a higher price if the same basmati is available at low prices in other states. Also, Punjab Rice Millers and Exporters’ Association complained that the police had wrongly charged around 100 rice millers for bringing non-basmati paddy. However, they are only getting a few varieties of basmati which are unavailable in Punjab.

In all, several leaders and rice millers have joined hands to bring basmati from UP, Bihar, and Madhya Pradesh. Consequently, farmers in Punjab are finding it difficult to fetch reasonable prices for basmati.

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