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P V Nitya Leela,
P V Gopi Krishna Rao,
- Aspiring Law Student, Rajeev Gandhi Memorial College of Engineering & Technology, Nandyal, Andhra Pradesh, India
- Professor, Department of Electronics and Communication, Rajeev Gandhi Memorial College Engineering & Technology, Nandyal, Andhra Pradesh, India
Abstract
Indian agriculture remains dominated by small and marginal farmers who face persistent income insecurity despite the existence of the Minimum Support Price (MSP) system. The MSP, designed to provide remunerative prices and food‑security procurement, has produced significant benefits in select regions and crops—especially wheat and paddy in states like Punjab, Haryana, and Madhya Pradesh. However, its coverage is uneven, with many farmers in pulses, oilseeds, and horticulture regions selling below MSP or even below cost of production. The Agricultural Produce Market Committee (APMC) mandi system, originally intended to regulate trade, has often turned into a mechanism of exploitation through commission agents, opaque quality grading, delayed payments, and cartels. Coupled with small landholdings, debt dependency, poor storage, and information asymmetry, these factors force farmers to sell at distress prices. This review synthesizes evidence on MSP’s impact, the functioning of mandis, the channels of exploitation, and the structural reasons behind low farm‑gate realizations and suggests policy directions for creating a more equitable and transparent agricultural marketing system in India. The review also considers the role of government procurement, Farmer Producer Organizations (FPOs), digital agricultural markets, warehouse facilities, and direct market linkages in reducing farmers’ dependence on intermediaries. Strengthening transparent price discovery, improving access to storage and institutional credit, and expanding procurement beyond a few major crops and states can help farmers obtain better returns. Greater awareness of MSP, improved market infrastructure, timely payments, and effective implementation of agricultural marketing reforms are also essential. The review emphasizes that MSP alone cannot address farm distress; a combination of price support, institutional mechanisms, infrastructure, and stronger bargaining power is required to ensure fair and sustainable farm incomes.
Keywords: Minimum Support Price (MSP), APMC mandi, commission agents, farmer distress selling, middlemen exploitation, agricultural marketing, India
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| Volume | 15 | |
| 03 | ||
| Received | 06/07/2026 | |
| Accepted | 25/07/2026 | |
| Published | 05/09/2026 | |
| Publication Time | 61 Days |