Context: 

Recently, the government of India revised the guidelines of the Market Intervention Scheme (MIS) to encourage the states to implement the MIS.

About Market Intervention Scheme (MIS)

• It is a component of the PM-AASHA scheme and is implemented at the request of the States or Union Territory (UT) Government.
• It supports the procurement of various perishable agriculture and horticulture commodities such as Tomato, Onion Potato, etc., for which the Minimum Support Price (MSP) is not applicable.
• To protect the growers of these horticultural/agricultural commodities from making distress sales in the event of bumper crops during the peak arrival period when prices fall to a very low level, the Government implements M.I.S. for a particular commodity on the request of a State Government concerned. 
• It is activated when there is a reduction of at least 10% in market prices in the respective States/UT compared to the rates of the previous normal season.
• The scheme is to ensure farmer are not forced to sell their produce under distress.
• Losses suffered are shared on a 50:50 basis between the Central Government and the State.

Revised guidelines for Implementation of MIS

• MIS will be implemented when there is a minimum reduction of 10% in the prevailing market price compared to the previous normal year.
• The procurement/coverage limit of production quantity of crops has been increased from the existing 20% to 25%.
• States are now allowed to pay the difference between the Market Intervention Price (MIP) and the selling price directly into the bank account of the farmers, instead of engaging in physical procurement.
• When there is a price difference between the producing and consuming states for TOP crops (tomato, onion, and potato), Central Nodal Agencies (CNA) such as NAFED and NCCF will reimburse the operational cost for storage and transportation.
• Approval has been given for NCCF to reimburse the transportation costs for up to 1,000 tonnes of kharif tomato from Madhya Pradesh to Delhi.
• In addition to NAFED and NCCF, it is proposed to include Farmer Producer Organisations (FPO), Farmer-Producer Companies (FPCs), State-Nominated Agencies, and other central nodal agencies, to undertake procurement of TOP crops under MIS. These entities will also handle storage and transportation arrangements when there is a price difference between producing and consuming states.

About Pradhan Mantri Annadata Aay SanraksHan Abhiyan (PM-AASHA)

It was launched in September 2018 to Provide price assurance for pulses, oilseeds, and copra, ensuring financial stability for farmers, reducing post-harvest distress selling & promoting crop diversification towards pulses and oilseeds.

The scheme is a continuation of the Integrated scheme of PM AASHA with the Price Support Scheme (PSS), Price Deficiency Payment Scheme (PDPS) & Market Intervention Scheme (MIS) as its components.

Under the PM-AASHA, the existing PSS will continue for pulses and copra, with 

• Central agencies including NAFED and FCI, will physically procure the produce whenever the market rate falls below MSP, up to a max limit of 25% of the total harvest.

For the Oilseeds alone, the States have option to choose either of the three schemes, namely -PSS, PDPS and PPSS.

Under the PDPS, all Oilseeds (8 types) for which MSP is notified will be covered. Farmers will sell their produce through a transparent auction process in the notified market, and the government will directly pay the difference between the MSP and the average market rate into farmers' registered bank accounts.

In this Pilot of PPSS, selected private agencies will procure oilseeds at MSP in notified markets when prices fall below the MSP, as authorized by the State/UT government. These private agencies will be paid a maximum service charge of 15% of the notified MSP, similar to the Price Support Scheme (PSS), involving physical procurement.