The last few days have seen political workers and farmers' organisations taking to the streets against the new farm laws over fears that they'll abolish the minimum support price (MSP) system.MSP data of the last 10 years shows successive governments have been hesitant to increase guaranteed prices on which they buy produce from farmers through various agencies.

But due to the ongoing protests, the government increased MSP for six rabi crops immediately.

Usually, revised MSPs for rabi crops are announced in October or November."MSPs will continue, and by announcing an increase in MSP, we have proved that," Union agriculture minister Narendra Singh Tomar said in Parliament on September 21.Data shows in the last 10 years, MSP growth rate for almost all crops, both kharif and rabi, have declined on an average.

In the latest announcement, MSP growth rates for wheat and paddy are the lowest in the last decade, at 2.6 per cent and 2.9 per cent respectively.From 2016-18, MSP growth rate for wheat had increased continuously.

In 2019, MSP growth rates for paddy and moong increased by 13 per cent and 25 per cent respectively.

But in 2020-21, MSP growth rates for all crops declined, except urad, moong and arhar.According to the decision taken by the Cabinet Committee on Economic Affairs (CCEA) on Monday, MSP for wheat was increased by only Rs 50 or 2.6 per cent to Rs 1,975 per quintal.

This is the lowest hike since 2011, when the government increased MSP by only Rs 20 or 1.8 per cent per quintal (100 kg) from the previous year.A political quick fix?The central government declares MSPs for 22 crops before their sowing seasons, based on suggestions by the Commission for Agricultural Costs and Prices (CACP), along with states' views on the demand and supply situation.MSP is the price at which the government guarantees to buy crops from farmers via different agencies such as Food Corporation of India (FCI).

As per procedure, farmers get at least one-and-a-half times the cost of production under MSP.

This system protects farmers from price fluctuations due to unfavourable weather conditions or by market manipulators.However, more often than not, MSP is used as a silver bullet to pacify distressed farmers.

For example, paddy witnessed the highest MSP growth in 2013 under the UPA government when it was increased by 16 per cent or Rs 170 to Rs 1,250 per quintal.

Under the NDA, the maximum hike in MSP (13 per cent) was in 2019.

Both were just before elections.Policy makers and economists are divided over the relevance of MSP.

In 2019, just before general elections, former economic adviser to Prime Minister's Office, Surjit Bhalla, pushed forward the need for agricultural reforms and suggested abolition of MSP within the next three years."The next government should cut corporate tax by 5 per cent, expand income support scheme and abolish MSP in the next three years.

There should be zero interference in agriculture," Bhalla had said in May 2019.Others say the farm sector is in severe distress and need to be protected through MSPs and other such instruments.

"MSP is essential for the farming sector to protect it against uncertainty in production and market fluctuations," said V Upadhyay, adjunct professor of economics at IIT-Delhi.