New Delhi, March 18 The government on Wednesday approved ₹1,718.56 crore as reimbursement for price support extended under Minimum Support Price (MSP) operations to the Cotton Corporation of India for the procurement undertaken in the 2023-24 cotton season.
The decision was taken by the Cabinet Committee on Economic Affairs, chaired by Prime Minister Narendra Modi.
As market prices of cotton fell below MSP during the season, the government agency had to undertake MSP operations to the extent of 32.84 lakh bales, benefiting about 7.25 lakh farmers and paying about ₹11,712 crore directly into their bank accounts, officials said.
The cabinet approved incurring expenditure towards reimbursement of price support extended under Minimum Support Price operations for cotton during Cotton Season 2023-24 (October 1, 2023, to 30 September, 2024), they added.
"In a significant step towards strengthening farmer welfare and advancing the vision of Aatmanirbhar Bharat, the CCEA has approved Minimum Support Price (MSP) funding of ₹1,718.56 crore to the Cotton Corporation of India (CCI) for the cotton season 2023-24," an official statement said.
The Centre fixes the MSP for seed cotton (kapas) based on the recommendations of the Commission for Agricultural Costs and Prices (CACP).
It has designated the CCI as the central nodal agency for undertaking MSP operations in cotton.
CCI procures all Fair Average Quality (FAQ) cotton from farmers without any quantitative ceiling, whenever market prices fall below MSP levels.
During the 2023-24 cotton season, the area under cultivation was estimated at 114.47 lakh hectares, with production pegged at 325.22 lakh bales, accounting for nearly 25 per cent of global cotton output.
As part of its preparedness, CCI has established a robust procurement network across all 11 major cotton-growing states, with over 508 procurement centres operational in 152 districts, ensuring seamless and accessible procurement for farmers.
The central government fixes the MSP for seed cotton (kapas) based on the recommendations of the Commission for Agricultural Costs and Prices (CACP), the statement said.
"Cotton remains one of India's most vital cash crops, sustaining the livelihoods of approximately 60 lakh farmers and supporting 400-500 lakh people engaged in allied activities, including processing, trade, and textiles," it added.