The Centre on Wednesday approved an increase in the Minimum Support Price (MSP) for paddy by Rs 72 per quintal for the 2026-27 kharif marketing season, raising the procurement rate for common paddy to Rs 2,441 per quintal.
The decision was taken during a meeting of the Cabinet Committee on Economic Affairs chaired by Prime Minister Narendra Modi. Under the revised rates, the MSP for common grade paddy has been increased from Rs 2,369 to Rs 2,441 per quintal, while the MSP for A-grade paddy has been raised by the same margin to Rs 2,461 per quintal for the 2026-27 kharif marketing season, which typically begins in September and October.
Announcing the decision, Union Information and Broadcasting Minister Ashwini Vaishnaw said the revised MSP ensures farmers receive at least 50 per cent more than the estimated cost of production, in line with the government’s commitment to provide remunerative prices to cultivators.
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Vaishnaw stated that the enhanced procurement price is expected to significantly benefit paddy growers across the country and strengthen farm incomes ahead of the upcoming sowing season.
According to government estimates, the total payout to farmers through paddy procurement operations is likely to reach around Rs 2.60 lakh crore during the season.
The Centre has also projected annual procurement at nearly 824.41 lakh tonnes, reflecting the scale of rice production and procurement expected under the MSP mechanism.
The MSP system plays a crucial role in protecting farmers from market fluctuations by guaranteeing a fixed price for crops, especially during periods of oversupply or falling market rates. Paddy remains one of the most extensively procured crops under the MSP framework, particularly in major producing states such as Punjab, Haryana, Chhattisgarh, Telangana and Andhra Pradesh.
The government revises MSPs for kharif crops every year based on recommendations made by the Commission for Agricultural Costs and Prices (CACP), taking into account factors such as input costs, demand-supply trends, market prices and overall agricultural growth.
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