New Scheme Offers Direct Price Differential Payment to Farmers; Focus on Storage & Transportation of TOP Crops
NEW DELHI, 7 April 2025: To protect farmers from distress sales and price volatility in the market, the Central Government has introduced several new measures aimed at ensuring better price realization for perishable agricultural and horticultural produce.
Responding to a question in the Rajya Sabha on Friday, Minister of State for Agriculture and Farmers’ Welfare, Ramnath Thakur, said the government is committed to safeguarding farmers’ incomes by strengthening market intervention mechanisms and improving post-harvest infrastructure.
Direct Price Support for Farmers
A key highlight is the introduction of the Price Differential Payment (PDP) component under the Market Intervention Scheme (MIS) starting from the 2024-25 season. This scheme allows direct payment of the difference between the Market Intervention Price (MIP) and the actual sale price of perishable crops to farmers — helping them recover losses without depending solely on physical procurement.
States and Union Territories now have the option to either procure the produce physically or transfer the price differential directly to farmers, offering greater flexibility in implementation.
Focus on Storage & Transportation of Tomato, Onion, Potato (TOP) Crops
To further support farmers, especially those growing Tomato, Onion, and Potato (TOP) crops, the government has added a provision under the MIS for reimbursing storage and transportation costs. This move will enable central agencies to transport these crops from surplus-producing states to deficit regions, helping stabilize prices and avoid wastage.
Existing Measures to Support Farmers
Agriculture marketing falls under the State list, but the Centre supports farmers through several schemes:
Market Intervention Scheme (MIS): For perishable horticultural and agricultural produce not covered under the Price Support Scheme (PSS).
National Agriculture Market (e-NAM): An online trading platform enabling competitive bidding for better price discovery.
Agmarknet: A nationwide system providing real-time market price information.
Agriculture Infrastructure Fund (AIF): Financial support for storage, warehousing, and post-harvest infrastructure through low-interest loans.
Shared Responsibility
Under the MIS, the Centre and State governments share losses incurred during market interventions — 50:50 for most states, and 75:25 for North-Eastern states.
These initiatives are designed to prevent distress sales during bumper harvests when market prices fall below the cost of production and to promote a more resilient and market-linked agricultural economy.
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