All India Rural Financial Inclusion Survey 2016-17

Even as it remains to be seen whether the government will be able to successfully implement its promise of buying all crops from farmers at a minimum support price (MSP) equal to 1.5 times their A2+FL costs, or make deficiency payments based on the MSP if they can’t procure the crop, the latest report from Nabard—All India Rural Financial Inclusion Survey 2016-17—as well as Price’s latest all-India survey add new perspective to the debate. For one, of the 212 million rural households the Nabard survey talks of, just around 100 million are considered to be ‘agricultural’, effectively implying that the MSP-based policy will apply to just half of rural India. Indeed, the actual impact will be far less since Nabard defines an ‘agricultural household’ as one that earned at least Rs 5,000 from various crops in the last one year and has at least one person employed in the sector, even if just for a temporary period in the last year; so the benchmark for being ‘agricultural’ is very low.