agriculture sector subsidy & food processing section 6 MCQ Questions & Answers Detailed Explanation

Answer: (c)

The Competition Act, 2002 prohibits anti-competitive agreements, abuse of dominant position by enterprises and regulates combinations (acquisition, acquiring of control and Merger and acquisition), which causes or is likely to cause an appreciable adverse effect on competition within India.

Competition Commission of India was established on 14 October 2003 and became fully functional in May 2009.

It is a body of the Government of India responsible for enforcing the Competition Act, 2002 throughout India and to prevent activities that have an adverse effect on competition in India

Answer: (a)

Answer: (c)

Commission for Agricultural Cost and Prices (CACP) takes into account several factors to recommend MSP to the Ministry of Agriculture and Farmers Welfare. Some of these factors are the cost of production and margin (profit) to farmers, Demand and supply, Price trends in the market both domestic and international, Intercrop price parity etc.

Among several criteria for recommending the MSP, the most important one is the cost of production of farmers and the margin/profit on it.

The cost of production of agricultural produce is calculated in three ways: A2, A2+FL and C2.

A2 costs basically cover all paid-out expenses, both in cash and in-kind, incurred by farmers on seeds, fertilizers, chemicals, hired labour, fuel, irrigation, etc.

A2+FL cover actual paid-out costs plus an imputed value of unpaid family labour.

C2 costs are more comprehensive, accounting for the rentals and interest forgone on owned land and fixed capital assets respectively, on top of A2+FL.

Finance Minister, while presenting the budget 2018-19 announced that, the Government will be offering MSP of 50 per cent over the cost of production (A2 + FL).

MSP is announced for 25 crops including sugarcane. The mandated crops are 14 for Kharif season viz. paddy, jowar, bajra, maize, ragi, arhar, moong, urad, groundnut-inshell, soyabean, sunflower, sesamum, nigerseed and cotton; 6 rabi crops viz. wheat, barley, gram, masur (lentil), rapeseed/mustard and safflower and two other commercial crops viz. jute and copra.

In addition, the MSPs of toria and de-husked coconut are fixed on the basis of the MSPs of rapeseed/mustard and copra respectively.

Answer: (a)

National Agricultural Cooperative Marketing Federation of India Ltd. (NAFED) is an apex organisation of marketing cooperatives for agricultural produce in India, under the Ministry of Agriculture, Government of India.

It was founded in October 1958 to promote the trade of agricultural produce and forest resources across the nation. NAFED is now one of the largest procurement as well as marketing agencies for agricultural products in India.

Answer: (c)

The National Development Council (NDC) in its 53rd meeting held on 29th May 2007 adopted a resolution to launch a Food Security Mission comprising rice, wheat and pulses to increase the production of rice by 10 million tons, wheat by 8 million tons and pulses by 2 million tons by the end of the Eleventh Plan (2011-12).

Accordingly, a Centrally Sponsored Scheme, ‘National Food Security Mission (NFSM), was launched in October 2007. The Mission is being continued during the 12th Five Year Plan with new targets of additional production of food grains of 25 million tons of food grains comprising of 10 million tons rice, 8 million tons of wheat, 4 million tons of pulses and 3 million tons of coarse cereals by the end of 12th Five Year Plan.

In order to accelerate the pulses production, the scope of the National Food Security Mission will be enhanced through the following changes:

1. The merger of Integrated Scheme on Oilseeds Pulses, Oil palm and Maize (ISOPOM) Pulses components and area with NFSM pulses,
2. Inclusion of additional programmes such as innovative “Accelerated Pulses Production Programme (A3P)” with nutrient and plant protection centric block demonstrations over 1 million hectares of pulses crop area and,
3. Inclusion of innovative development and research projects.

Answer: (a)

Green Box subsidies include amounts spent on research, disease control, infrastructure and food security.

These also include direct payments made to farmers such as income support that do not stimulate production. These are not considered trade-distorting and are encouraged.