Supreme Court Takes a Stand: Farmers Demand Fair MSP Based on Actual Cultivation Costs

In a landmark decision, the Supreme Court of India has issued a notice on a public interest litigation (PIL) that calls for the Union Government to reassess its methodology for determining the Minimum Support Price (MSP) for agricultural produce. The petition, filed by three farmers from Maharashtra—Prakash Gopalrao Pohare, Purushottam Gawade, and Vishal Omprakash Rawat—argues that the current MSP framework is fundamentally flawed, as it primarily relies on A2+FL (paid-out costs plus family labour) and neglects crucial components such as land costs and interest on working capital.

The Bench, led by Chief Justice of India Surya Kant and Justice Joymalya Bagchi, listened to Advocate Prashant Bhushan, who passionately articulated the dire circumstances faced by farmers across the nation. He pointed out the alarming rate of farmer suicides, which he attributed to inadequate procurement mechanisms and MSPs that often fall below the comprehensive cost of cultivation. Bhushan emphasized that while MSP is a lifeline for staple crops like wheat and rice, it leaves farmers of other crops in severe financial distress.

"We are not asking for a cost-plus profit margin; we simply want the actual cost of cultivation, known as C2," Bhushan clarified during the hearing. He stressed that the government already calculates these costs, and farmers deserve to recover their full expenses. He further argued that welfare initiatives, such as free ration schemes, should not undermine the financial stability of farmers, who are essential to the nation’s food security.

The Chief Justice acknowledged the complexities involved in determining the costs of land and capital, which can vary widely across different states. Justice Bagchi raised concerns about the implications of the relief sought, suggesting it could require the Court to redefine economic policy. In response, Bhushan asserted, "It's commendable for the government to provide free rations, but this should not come at the cost of farmers' livelihoods, leading to tragic outcomes like suicides."

The petition highlights a grim reality: over 17,000 farmers have reportedly taken their own lives in Maharashtra alone over the past five years due to financial distress. The petitioners argue that the existing MSP methodology, which is based on A2+FL multiplied by 1.5, fails to account for vital costs, thereby misrepresenting the true economic burden on farmers.

Furthermore, the petition raises critical concerns about the skewed procurement practices that favor wheat and rice, leaving farmers of other crops without adequate support. This disparity has led to a distortion in agricultural markets, particularly affecting the demand for diverse crops like millets, which are essential for nutritional security.

The farmers are calling for a recalibration of the MSP to align it with the C2 cost of production as calculated by the government, along with the establishment of robust procurement infrastructure to ensure that all crops are purchased at fair prices. This case underscores the urgent need for policy reform to safeguard the livelihoods of farmers and prevent further tragedies in the agricultural sector.

Related: Supreme Court Urges Centre To Revisit Yellow Dal Import Policy; Says Farming of Pulses Must Be Incentivized

Case Reference: PRAKASH GOPALRAO POHARE Vs UNION OF INDIA | W.P.(C) No. 384/2026