Commission for Agricultural Costs and Prices [CACP]

The Commission for Agricultural Costs and Prices [CACP] was established in January 1965. Earlier known as Agriculture Price Commission, it was renamed the Commission for Agricultural Costs and Prices [CACP] in 1985. CACP is a decentralised organisation of the Government of India. It is attached to the Ministry of Agriculture and Farmers Welfare of the Government of India as an advisory body.

Composition of Commission for Agricultural Costs and Prices [CACP]

Commission for Agricultural Costs and Prices [CACP] currently comprises a Chairman, Member Secretary, one Official Member, and Two Non-Official Members. The Non-Official members act as representatives of the farming community and are usually actively associated with the farming community.

The Mission of the Commission for Agricultural Costs and Prices

Recommend Minimum Support Prices (MSP). Government fixes the MSPs for all the major agricultural products every year with the help of the recommendations provided by the Commission. These recommendations are vital for developing a remunerative and strong price environment to increase agricultural production and productivity.

Currently, there are 23 commodities for which MSPs are recommended by the Commission for Agricultural Costs and Prices [CACP]. These 23 commodities consist of 7 kinds of cereal, 5 pulses, 7 oil seeds, and 4 commercial crops.

To motivate cultivators and farmers to take up new technologies to optimise the use of resources and thereby increase overall productivity.

Roles and Responsibilities of the Commission for Agricultural Costs and Prices [CACP]

• Commission for Agricultural Costs and Prices [CACP] submits the recommendations in the form of a Price Policy Report to the Government of India each year for five groups of commodities. Kharif Crop, Rabi Crops, raw jute, sugarcane, and Copra.
• Before preparing the price mentioned above in Policy Reports, a comprehensive questionnaire is prepared by the commission. This is then sent to all the state governments and concerned national-level organisations and Ministries to seek their opinion.
• Meetings are also held with farmers of different states, state governments, and national-level organisations like NAFED, Cotton Corporation of India (CCI), Jute Corporation of India (JCI), etc. Meetings are also held with traders and processing organisations and main Central Ministries.
• The commission also makes on-the-spot assessments during its visits to the states. This is necessary for identifying the constraints the farmers are facing in the marketing of their products and increasing the crop production level.
• Based on all these inputs, the CACP makes its recommendations, which are then submitted to the Government.
• The CACP report is then circulated amongst the state governments and concerned central level Ministries to collect their views.
• Only after receiving feedback from them on the CACP report that the Cabinet Committee on Economic Affairs (CCEA) takes the final decision regarding the MSPs and other important recommendations as made by the Commission for Agricultural Costs and Prices.
• After the decision is made, the report is put on the CACP website to help the stakeholders understand how CACP's price and non-price recommendations are made.

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FAQs on Commission for Agricultural Costs and Prices [CACP]

Q1. Is the Commission for Agricultural Costs and Prices [CACP] a statutory body?

The Commission of Agricultural Costs and Prices is an advisor body, not a statutory one.

Q2. What are the functions of the Commission for Agricultural Costs and Prices [CACP]?

The Commission for Agricultural Costs and Prices [CACP] shoulders the important responsibility of ensuring a remunerative and stable price market for all agricultural productions by effectively handling market inefficiencies.

Q3. How does the Commission recommend MSPs for Agricultural Costs and Prices?

While making recommendations on MSPs, the Commission for Agricultural Costs and Prices takes into account factors like the demand and supply of a commodity, its cost of production, inter-crop price parity, and market price trend, among others.

Q4. What is CACP UPSC?

The CACP UPSC is an advisory body attached to the Ministry of Agriculture and entrusted with recommending MSPs for 23 commodities.