MSP Full Form

What is the full form of MSP Today we will discuss an important topic – MSP . First of all you should know what is MSP . MSP has been brought mainly for Indian farmers by the Government of India and it is nothing less than a boon for the farmers.

MSP is known as the ‘safety net’ for farmers as it is the core of the agricultural revolution which has seen India transform from food shortage to food surplus nation. To overcome the effects of financial volatility in India, MSP has helped farmers over the years.

But do you know what is the full form of MSP , what is its main purpose, what are the benefits of MSP to the farmers etc.? Maybe you are a farmer or belong to a farmer family. In such a situation, it is more important for you to know about MSP. So let’s know about MSP-

What is MSP full form?

MSP का full form in English: Minimum Support Price

Full form of MSP: Minimum Support Price or ” Minimum Support Price “.

MSP (Minimum Support Price) is the price set by the Government of India to protect the producers and farmers from falling too much during the years of production. Through MSP , the government keeps the farmers in India safe from market and natural calamities.

If seen, MSP acts as a “Safety Net” or safety net for the farmers . You have already got the idea of ​​what MSP is and how it works. Now read the entire article to know about the purpose of MSP , its origin, its advantages and disadvantages. Along with this, we will also know which crops  come under  MSP .

Objectives of MSP

There are basically two objectives of MSP:

  • To save the farmer from distress sale.
  • Buying food grains for public distribution.

MSP is applicable for some important crops which the government buys directly from the farmers. The MSP was created to ensure that the farmer gets the minimum return for his crop even when there is a sharp fall in the prices of agricultural products.  

Origin of MSP:

In the 1960s, the Green Revolution had started in India. Several agricultural policy initiatives were proposed during the Green Revolution, including setting a government price for food grains. One of the main objectives of the Green Revolution was the promotion of agricultural land production.

For this some measures were adopted such as higher yield farming, better equipment and fertilizers. This included targeted price policy support to increase land productivity. Price policy support was targeted to improve land productivity.

For this reason, the Agricultural Price Commission (APC) was formed in 1965. APC implemented a number of price measures including pre-determined procurement prices, minimum support prices and a distribution system that provided food grains at subsidized rates.

The Agricultural Price Commission (APC) was reorganized in March 1985 as the Commission for Agricultural Costs and Prices (CACP), which included many new policies. Apart from CACP, institutions like Food Corporation of India (FCI) and National Agricultural Co-operative Marketing Federation (NAFED) were also involved in the implementation of MSP .

Wheat was the first crop under the MSP to be priced at Rs 54 per quintal by the government.

How MSP advantaged the farmers?

MSP works as a base price, which gives assurance from the government to the producers and farmers that the prices of their goods will not go below the fixed level set by the government, no matter how low the market prices may be. Farmers have benefited a lot from MSP which are as follows:

  • As a result of MSP , the biggest benefit to the farmers is that they know that they will get a fair price for their crops, no matter what.
  • When a farmer sells his produce in a government market, the entire amount he receives is immediately credited to his bank account, with no brokers or corruption involved.
  • The government can buy these crops directly from the farmers and sell them in government fair pricing shops at a price lower than the market rate. With this, the government can reach these crops to the poor at a reasonable price.
  • Through MSP the government can control the growth of low yielding crops. Government provides more price support for these crops so that farmers are motivated to grow them. Farmers get assurance that they will be able to recover at least 50% of their invested amount due to the fixed Minimum Support Price set by the government.
  • If a large quantity of crops is produced in the country in any year, then MSP guarantees to the farmers that they will definitely get the minimum support price, no matter what the price of that crop is in the market.

What are the disadvantages of MSP?

It is not that farmers have only benefited from MSP , they have also faced some disadvantages:

  • Due to MSP , farmers do not get the freedom to choose their crop based on their cost of production and time taken. 
  • There are many farmers who  do not have enough knowledge about Minimum Support Price , eventually they get caught in the affair of brokers.
  • The government announces MSP every year but this minimum rate does not increase in proportion to the increasing manufacturing costs.
  • Government intervention in the market destroys market competition and hinders the efficiency of the open market.
  • Due to MSP there has been an increase in the maintenance costs of getting the crop of the government. This may have an impact on the government’s agricultural investment budget. 

How is MSP determined?

The government announces the MSP at the beginning of every crop season . The two major crop seasons in our country are ‘Rabi’ and ‘Kharif’. MSP determines the price by taking into account many aspects like cost of production, changes in input prices, demand and supply, trends in market prices, effect on general price level.

Based on the recommendations of the Commission for Agricultural Costs and Prices, the Department of Agriculture and Cooperation, Government of India, declares the Minimum Support Price (MSP) for 22 crops before their sowing season.

The following crops are covered under MSP:


  1. Paddy
  2. Wheat
  3. Maize
  4. Sorghum
  5. Pearl Millet
  6. Barley
  7. Ragi


  1. Chickpea
  2. Tur
  3. Moong
  4. Urad
  5. Lentil


  1. Peanut
  2. Rapeseed
  3. Soya Bean
  4. Sesame
  5. Sunflower
  6. Safflower
  7. Niger Seed

 Commercial crops:

  1. Copra
  2. Sugarcane
  3. Cotton
  4. Raw jute  

MSP Full Form: Conclusion

Friends, I would like to tell you, Minimum Support Price (MSP) is the minimum price fixed by the government for some agricultural products at which the products will be bought directly from the farmers if the open market prices are less than the cost. This is an important topic for UPSC exam.