MSP stands for

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Minimum Support Price

Maximum Support Price

Minimum Support Procedure

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Detailed Solution

MSP stands for Minimum Support Price.
The Food Corporation of India procures surplus food grains produced by farmers and stores them in government-owned granaries, and these surplus food grains are called Buffer Stock. The farmers are paid an MSP (Minimum Support Price) which gives them the incentive to produce surplus food grains like wheat and rice. The MSP is decided by the government before the sowing season every year. The buffer stock is used to provide food to the poorer strata of the society through the ration or fair price shops that provide essential food grains at a price lower than the market price (issue price). The buffer stock is also utilized in the deficit regions to provide them with food.

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