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EconomicsSource: Indian Express

Farmers’ Share in Rabi Crop Consumer Prices Ranged from 40-67%: RBI Survey

Saturday, 1 March 2025
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Key Points

Farmers’ Share in Consumer Prices: A recent RBI survey reveals that farmers received between 40% to 67% of the final consumer price for major rabi crops. This is crucial for UPSC aspirants as it relates to economic challenges and agricultural policies, relevant for GS Paper 3. Last Updated: 2025-03-01

Key Facts About Farmers' Share in Rabi Crop Consumer Prices

  • Farmers’ Share in Consumer Prices: Ranged from 40% to 67% for rabi crops.
  • Wheat Farmers: Received 67% of the consumer price; 25% sold at Minimum Support Price (MSP).
  • Rice Farmers: Share was 52% in 2024; consistent with 45% in 2022 and 49% in 2018.
  • Pulses and Oilseeds: Lentil farmers received 66% and Gram farmers 60%.
  • Mustard Farmers: Received 52%, down from 55% in 2021.
  • Perishable Crops: Farmers’ share ranged from 40% to 63%, lower than cereals and pulses.
  • Traders and retailers accounted for over 50% of consumer prices for most perishable crops.
  • Electronic payments in agriculture have increased significantly since 2018.

India's Agricultural Supply Chain Challenges

The survey underscores the macro-level significance of improving the agricultural supply chain in India. A robust supply chain is vital for enhancing farmers' income, aligning with India's strategic goals of doubling farmers' income and ensuring food security. Comparatively, India's agricultural efficiency lags behind global leaders due to logistical inefficiencies and market access issues.

Related Government Schemes/Policies

  • Pradhan Mantri Fasal Bima Yojana: Provides insurance coverage and financial support to farmers in the event of crop failure.
  • e-NAM: Aims to create a unified national market for agricultural commodities.
  • PM-KISAN: Provides income support to farmers to supplement their financial needs.

UPSC Relevance

  • GS Paper 3: Economic Development, Agriculture - issues related to direct and indirect farm subsidies and minimum support prices.
  • Prelims: Questions on the percentage share of farmers in consumer prices, MSP, and related schemes.
  • Mains: Analytical themes on agricultural supply chain reforms and the impact of digital transactions on rural economies.
  • Essay Paper: Topics on agricultural reforms and rural economic development.

FAQ Section

  • What is the farmers' share in rabi crop consumer prices? The farmers' share in consumer prices for rabi crops ranges from 40% to 67%, according to the RBI survey.
  • Why is the farmers' share important? It is crucial as it affects farmers' income and economic stability, influencing their ability to invest in better farming practices.
  • What are the key features of the RBI survey? The survey highlights the disparity in farmers' share across different crops, the impact of supply chain inefficiencies, and the rise of digital transactions in agriculture.

Detailed Coverage

  • Farmers’ Share in Consumer Prices: Ranged from 40% to 67% for rabi crops.
  • Wheat Farmers: Received 67% of the consumer price; 25% sold at Minimum Support Price (MSP).
  • Rice Farmers: Share was 52% in 2024; consistent with 45% in 2022 and 49% in 2018.
  • Pulses and Oilseeds: Lentil farmers received 66% and Gram farmers 60%.
  • Mustard Farmers: Received 52%, down from 55% in 2021.
  • Perishable Crops: Farmers’ share ranged from 40% to 63%, lower than cereals and pulses.
  • Traders and retailers accounted for over 50% of consumer prices for most perishable crops.
  • Factors for low share in perishable crops include short shelf life and logistical challenges.
  • An unorganized supply chain limits transparency in pricing.
  • A lower farmers' share discourages crop diversification away from cereals.
  • Electronic payments in agriculture have increased significantly since 2018.
  • The RBI survey highlights the decline in farmers' share in consumer prices.
  • Cash transactions still dominate in agriculture.
  • Survey shows the impact of climate dependency and demand fluctuations.
  • Challenges in supply chain affect farmers' earnings.
  • Overall, the study emphasizes the need for improved market access for farmers.
Economics

Practice Questions

Test your understanding of this article

Question 1 of 50 / 5 answered
1

Assertion (A): Electronic payments have increased significantly in the 2024 survey compared to 2018 and 2022.

Reason (R): Cash transactions still dominate agriculture despite the increase in electronic payments.

In the context of the above statements, which of the following is correct?