The 2015 Shanta Kumar Committee found that only about 6 percent of farmers actually sell their crops at MSP rates. This is because MSP acquisitions by the government do not occur uniformly and because it is the same across India it does not necessarily benefit all farmers.
For example, C2 of rice paddy increased 11.2 percent in Bihar from 2004-05 to 2014-15 and 11.9 percent in West Bengal, while MSP, based on a weighted average of C2 across the country, increased by 10.6 percent in the same period. period (according to Hindustan Times).
Public procurement under the MSP is largely only done for wheat and rice, given their importance to the PDS system. The National Food Security Law of 2013 creates an obligation for the government to ensure that the PDS system provides cereals at a subsidized rate, hence this demand.
This also explains why protests against Farm Bills have been strongest in Punjab and Haryana, which produce these crops in massive quantities. More than 85 percent of the wheat and rice grown in Punjab, and 75 percent of the two crops in Haryana, are purchased by the government at MSP rates according to data from the Ministry of Agriculture.
To illustrate this point, Punjab, Haryana, and Andhra Pradesh account for 50 percent of the rice purchased under the MSP mechanism. Rice farmers in other states, even like West Bengal where there is high production and consumption, do not really benefit from the MSP regime. In the case of wheat, it is Punjab, Haryana and Madhya Pradesh that account for the majority of purchases under the MSP system.
the Hindustan Times notes that according to the 2012-13 National Sample Survey data, only 13.5 percent of rice farmers actually benefited from the MSP system, and only 16.2 percent of all rice farmers in India they used it. Only 32.2 percent of rice producers were even aware of the system, and 39.2 percent of wheat producers.
(You can read the Hindustan Times article on these discrepancies here. The Shanta Kumar Committee Report can be found here.)
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