Why In News? 

The Government of India expanded procurement operations under the PM-AASHA scheme.

What is PM-AASHA?

The Pradhan Mantri Annadata Aay SanraksHan Abhiyan (PM-AASHA) is an umbrella scheme launched by the Ministry of Agriculture & Farmers Welfare, in 2018 to ensure that farmers receive the Minimum Support Price (MSP) for their produce. 

What are the key components of PM-AASHA? 

Price Support Scheme (PSS)

Physical Procurement: Central nodal agencies (like NAFED and NCCF) physically procure pulses, oilseeds, and copra.

Loss Coverage: The Central Government bears the procurement expenditure and losses incurred during the sale of these commodities.

Recent Update: To achieve self-sufficiency, the government has removed the 25% procurement ceiling for Tur, Urad, and Masur, allowing for 100% procurement of these pulses.

Price Deficiency Payment Scheme (PDPS)

Direct Benefit Transfer: This applies to oilseeds. No physical procurement takes place.

The Mechanism: The government pays farmers the difference between the MSP and the actual market price (Modal Price) directly into their bank accounts.

Objective: To provide price protection without the logistical burden of physical storage and handling by the government. 

Private Procurement & Stockist Scheme (PPPS)

Private Participation: This is a pilot scheme for oilseeds where private players are invited to procure produce at MSP in selected districts.

Incentives: Private stockists receive a service charge to cover their costs, encouraging competitive market participation. 

Market Intervention Scheme (MIS)

Perishable Crops: This component protects farmers of horticultural and perishable commodities (like apples, onions, or potatoes) when market prices crash due to a bumper harvest.

Recent Reform: The government has increased the coverage from 20% to 25% of production and streamlined the fund-sharing pattern to support states more effectively. 

What are the achievements of PM-AASHA so far? 

Beneficiary Reach: Since 2018, PM-AASHA has benefited 99.3 lakh farmers through the procurement of 195.39 LMT of pulses, oilseeds, and copra, disbursing over ₹1,07,433 crore in MSP value.

Soybean Milestones: A record 5.62 LMT of Soybean was procured in the 2024-25 Kharif season, supporting 2.4 lakh farmers during price crashes.

100% Procurement Policy: For 2024-25, the 25% ceiling for Tur, Urad, and Masur was removed. The government now aims to procure 100% of these pulses to achieve self-sufficiency.

Market Stability: The Price Stabilization Fund (PSF) maintains buffers of onions and pulses to mitigate retail inflation during lean periods.

What are the major challenges limiting its success? 

Procurement "Reach" Deficit: Physical procurement remains low relative to production; for Tur in 2024-25, only 0.15 LMT was procured against a 13.22 LMT target by mid-February 2025, hindered by a lack of remote procurement centers. 

Inadequate Infrastructure: NITI Aayog identifies critical shortages in storage, weighing, and drying facilities, leading to crop rejection under strict Fair Average Quality (FAQ) standards due to insufficient farm-gate processing. 

State-Level Resistance: The PDPS suffers from low adoption despite its efficiency. States favor physical procurement (PSS) because PDPS requires transparent market data that local mandis currently lack.

Private Sector Disinterest: The Private Procurement & Stockist Scheme (PPSS) pilot has struggled as private entities find government service charges insufficient to offset high market volatility risks.

What reforms are needed to make PM-AASHA more effective?

Structural and Infrastructure

• Decentralized Procurement: Establish village-level hubs via Primary Agricultural Credit Societies (PACS) to reduce farmer transport costs.
• Storage Expansion: Utilize the Agriculture Infrastructure Fund (AIF) to build block-level cold storage and silos, cutting post-procurement waste.
• Quality Flexibility: Replace strict Fair Average Quality (FAQ) standards with "graded pricing" to accept B-grade produce from small farmers.

Financial and Operational

• PDPS Incentives: Encourage the Price Deficiency Payment Scheme via central grants to provide direct Aadhaar-linked top-ups, avoiding storage logistics.
• Swift Settlements: Launch a Real-Time Payment System through e-NAM to ensure disbursements within 48–72 hours.
• Private Sector Support: Revise service charges for the Private Procurement & Stockist Scheme to ensure commercial viability.

Technological and Data Reforms

• Unified Digital Registration: Utilize a Single National Farmer Database for auto-registration using land records and crop data.
• Real-Time Price Intelligence: Leverage AI and Big Data to predict crashes and open procurement centers preemptively.
• Satellite Monitoring: Verify yields via satellite imagery to block middlemen from accessing MSP.

Awareness and Capacity Building

• Mobile Alerts: Implement a direct alert system for real-time updates on procurement dates and norms.
• FPO Empowerment: Enable FPOs as procurement agents to boost collective bargaining and reduce individual farmer burdens.

Conclusion

PM-AASHA reflects India’s transition from price declaration to price realization, but its true success lies in bridging policy design with ground-level delivery.

Source: PIB