Section Article

THERE IS A SIGNIFICANT DISPARITY BETWEEN MSP AND MRP
Author(s): Dr. Keya Ganguly

Abstract
The divergence between Minimum Support Price (MSP) and Maximum Retail Price (MRP) has emerged as a critical concern in agricultural economics policy discourse and socio-economic planning in India. MSP designed to ensure farmers receive remunerative returns for their produce often remains disconnected from MRP which governs the retail pricing mechanism in the market. This disparity creates structural inefficiencies reduces agricultural profitability and exacerbates rural income inequality. The present study critically examines the underlying causes economic implications and policy challenges associated with the MSP-MRP gap.Drawing on empirical studies government reports scholarly articles and case studies published prior to 2021 the research evaluates the pricing mechanisms of major crops assesses market dynamics and explores the socio-economic impact of the MSP-MRP disparity on farmers consumers and supply chains. The study highlights that factors contributing to this disparity include inadequate procurement mechanisms market intermediaries storage and transportation inefficiencies and regional variations in production costs and demand.The research underscores that persistent MSP-MRP gaps have far-reaching consequences. For farmers low procurement prices relative to MRP reduce profitability and affect investment capacity contributing to agrarian distress. Consumers face inflated prices while intermediaries capture disproportionate margins highlighting inefficiencies in price transmission. Policy interventions aimed at bridging the gap including improved procurement strategies market reforms supply chain modernization and transparency in price setting are analyzed.The study also examines the role of international trade input costs and government subsidies in influencing MSP and MRP dynamics. Evidence suggests that a holistic approach combining policy alignment technological integration and stakeholder engagement can mitigate disparities and improve the efficiency and equity of the agricultural pricing system. The findings provide actionable insights for policymakers economists agricultural practitioners and civil society stakeholders committed to creating fair sustainable and inclusive agricultural markets in India.