New Delhi: The Indian Council for Research on International Economic Relations (ICRIER) has estimated that farmers in the country have lost around Rs 40,000 crore after the government dumped wheat in the market in a bid to control surging inflation.The ICRIER report has also warned that such restrictive policies by the government could also push paddy farmers to face similar losses in the upcoming procurement season.“Similar restrictive policies are in place for pulses farmers, and now even onion farmers. This calls for revisiting market restrictive policies, and compensating farmers for the substantial transfer of resources from producers to consumers,” Business Standard quoted from the ICRIER report, titled Tackling Food Inflation. A total of 112 metric tonnes of wheat was produced in the country in 2022-23. In the 2023-24 rabi season, a quintal of wheat was sold at a minimum support price (MSP) of Rs 2,125, and at Rs 2,673 in the open market.Explaining the reasons for the loss incurred by wheat farmers, the report says that the government had launched the open market sale scheme (OMSS) in February this year to sell wheat at a substantially reduced of Rs 2,350 per quintal and then further lower at Rs 2, 150 per quintal, with an intention to stabilise domestic prices. However, the OMSS prices were significantly lower than the cost incurred by farmers in producing wheat, which was at Rs 2,654 per quintal in 2022-23.“Without this market intervention, farmers could have potentially earned an additional Rs 548 per quintal (Rs 2,673 minus Rs 2,125) from their sales of wheat resulting in a loss of around Rs 40,000 crore to farmers,” the report adds.The research body suggested the government use trade policy judiciously to control inflation at home without hurting farmers’ earnings.
