Procurement of wheat and rice in India: an empirical analysis
Student name: Ms Lipika Roy
Guide: Dr Sushmita Chatterjee
Year of completion: 2013
Host Organisation: TERI University
Abstract: There has been a widespread outrage in the recent times concerning the rotting of grains
procured by the Government due to lack of appropriate storage facilities. The present paper
aims to identify the factors that determine the volume of procurement of the primary
foodgrains i.e. rice and wheat in India. The main aim is to analyse whether the growth in
procurement has been due to price factors like the ever increasing Minimum Support Price
(MSP) by the Government or whether it is due to the growth in the production of the
principle food crops. The difference between the two is important as one measures the scale
effect while the other measures the substitution effect. The paper carries out this estimation
for both the All India levels as well as the state levels for the top three producing states of
each crop. Other than that the paper also tries to see the diverse explanations to which this
unprecedented rise in procurement can be attributed. The flaws in the present system of
procurement and some possible solutions of them.
