Question map
The Fair and Remunerative Price (FRP) of sugarcane is approved by the
Explanation
The FRP is approved by the Cabinet Committee on Economic Affairs (CCEA) on the basis of the cost of production recommended by the Commission for Agricultural Cost and Prices (CACP).[1] This is an important distinction to understand: while FRP is determined by the central government on the basis of recommendations of the Commission for Agricultural Costs and Prices (CACP)[2], the final approval authority rests with the CCEA.
MSP is the price paid by government to farmers for procurement, whereas FRP is the price fixed by government but is paid by mill owners. FRP is fixed by government only for sugarcane.[3] The CACP plays a crucial advisory role by recommending the price based on cost of production and other factors, but it is the Cabinet Committee on Economic Affairs that has the authority to approve and finalize the FRP that sugar mills must pay to farmers.
Sources- [3] Indian Economy, Nitin Singhania .(ed 2nd 2021-22) > Chapter 9: Agriculture > MINIMUM SUPPORT PRICE > p. 328
PROVENANCE & STUDY PATTERN
Full viewThis is a classic 'Authority vs. Advisory' trap. The question tests if you can distinguish between the technocratic body that calculates/recommends (CACP) and the political executive body that formally approves (CCEA). It is a fair, standard question found in every serious economy resource.
This question can be broken into the following sub-statements. Tap a statement sentence to jump into its detailed analysis.
- Statement 1: Does the Cabinet Committee on Economic Affairs approve the Fair and Remunerative Price (FRP) of sugarcane in India?
- Statement 2: Does the Commission for Agricultural Costs and Prices approve the Fair and Remunerative Price (FRP) of sugarcane in India?
- Statement 3: Does the Directorate of Marketing and Inspection (Ministry of Agriculture) approve the Fair and Remunerative Price (FRP) of sugarcane in India?
- Statement 4: Does the Agricultural Produce Market Committee approve the Fair and Remunerative Price (FRP) of sugarcane in India?
- Snippet explicitly names the Cabinet Committee on Economic Affairs (CCEA) as the approving authority for the Fair and Remunerative Price (FRP) of sugarcane in a previous‑years question item.
- Direct statement linking FRP approval to CCEA provides the most explicit support among the snippets.
- States that the Ministry of Consumer Affairs, Food and Public Distribution recommends the FRP for sugarcane, identifying the recommendation stage of the process.
- Shows FRP is an announced price (binding on mill owners), implying a formal central approval step follows recommendation.
- Clarifies that FRP is fixed by the government (and specifically applies only to sugarcane), indicating central government involvement in FRP fixation.
- Supports the premise that a central authority (such as CCEA) is the plausible approving body for FRP.
- Explicitly states which body approves the FRP and the role of CACP in the process.
- Shows that CACP provides recommendations but approval is by the Cabinet Committee on Economic Affairs (CCEA), not CACP.
- States FRP is determined on the basis of recommendations of the Commission for Agricultural Costs and Prices (CACP).
- Implies CACP recommends but does not itself approve the FRP.
States that for sugarcane the Ministry of Consumer Affairs, Food and Public Distribution recommends the Fair and Remunerative Price (FRP), distinguishing the recommending authority from CACP.
A student could check jurisdiction/responsibility differences between ministries (Agriculture vs Consumer Affairs) to infer which body likely approves FRP.
Explains FRP is a government-fixed price paid by mill owners and that FRP is fixed by government only for sugarcane (distinct from MSP procurement by government).
Use this distinction to focus inquiry on which government agency handles sugarcane-specific pricing versus general MSP mechanisms.
Notes that government announces MSP for many crops and FRP specifically for sugarcane, and separately describes the CACP's role when recommending MSP.
Since CACP is explicitly tied to MSP recommendations, a student could infer CACP's typical remit and question whether FRP (a separate instrument) falls under that remit.
States that MSPs are recommended by the Commission for Agricultural Costs and Prices (CACP) and approved by the Cabinet Committee on Economic Affairs (CCEA).
A student can extend this pattern (CACP→CCEA for MSP) to test whether FRP follows the same approval chain or a different one (as hinted by other snippets).
Presents a multiple-choice question asking which body approves the FRP, listing CACP among possible options — indicating the question is nontrivial and debated in sources.
Use this as an example that authoritative sources treat the approving authority for FRP as a distinct, examinable fact to verify (so one should not assume CACP without checking).
- Explicitly states which body approves the FRP: the Cabinet Committee on Economic Affairs (CCEA) approved the FRP.
- If CCEA approves FRP, this indicates approval is by central government bodies, not the Directorate of Marketing and Inspection (DMI).
- Explains FRP determination: it is set by the central government based on CACP recommendations.
- No mention of DMI as the approving authority, implying approval lies with central government/CACP process.
- Mentions the role of the Commission for Agricultural Costs and Prices (CACP) in recommending MSPs/FRP.
- Supports that recommendation/approval is handled via CACP/central channels rather than DMI.
States that for sugarcane the Ministry of Consumer Affairs, Food & Public Distribution recommends the FRP and that States may announce SAP; it ties FRP to a specific ministry rather than DMI.
A student could check which ministry typically recommends FRP (Consumer Affairs) and thus look for approval authority within that ministry or related committees, not DMI.
Explains the distinction: FRP is fixed by government only for sugarcane and is paid by mill owners (different from MSP procured by government).
Use this rule to narrow which agencies handle price-fixing (those involved in price policy for commodities) rather than agencies handling standards/marketing like DMI.
Describes the MSP-setting process: CACP recommends MSP and CCEA approves it, illustrating that price-setting involves CACP/CCEA for MSP and a formal approval route.
By analogy, a student can infer FRP likely follows a formal recommendation/approval route involving relevant price or cabinet bodies, so they can look for a similar chain for FRP rather than DMI.
Shows the Directorate of Marketing and Inspection (DMI) is an attached office concerned with standards (AGMARK) under the Ministry of Agriculture & Farmers Welfare, implying its primary role is quality/standards not price fixation.
A student can contrast DMI’s standards/marketing role with price-setting responsibilities to judge whether DMI is the likely approver of FRP.
Presents a multiple-choice question asking which body approves the FRP, listing CCEA, CACP, DMI, etc., indicating that authoritative bodies (e.g., CCEA/CACP) are considered relevant options and DMI is presented for comparison.
Use the listed alternatives to focus further research on the more plausible approving authorities (CACP/CCEA) and deprioritise DMI unless supporting evidence appears.
- Shows that the FRP is approved at the central government level by the Cabinet Committee on Economic Affairs (CCEA), not by a local market committee.
- Indicates central-government authority over FRP approval for sugarcane payable by mills.
- States that FRP is determined by the central government based on recommendations of the Commission for Agricultural Costs and Prices (CACP).
- Attributes FRP setting to central authorities and CACP consultation, not to Agricultural Produce Market Committees (APMCs).
Explains who recommends FRP for sugarcane (Ministry of Consumer Affairs, Food & Public Distribution) and distinguishes FRP/SAP as the price at which mill owners must buy cane.
A student could check institutional responsibility of that Ministry vs state APMCs (e.g., look up the Ministry's notifications) to see if APMC is the approving body.
States that FRP is fixed by the government (and paid by mill owners) and is distinct from MSP procurement by government.
Use this rule to infer that approval likely rests with a central government authority rather than a market-regulating body like APMC, then verify which central body issues FRP orders.
Notes explicitly that the government announces FRP for sugarcane (contrasting it with MSP for other crops).
This suggests FRP follows a government-level procedure; a student can compare the statutory powers of APMCs (state-level market regulators) versus the central government to judge plausibility.
Describes the MSP approval process (CACP recommends, CCEA approves) for crops—illustrates that price-setting can be a central recommendation/approval process rather than market-committee action.
By analogy, a student can ask whether FRP follows a similar central recommendation/approval route (and then check which commission/ministry handles FRP), reducing likelihood that APMC approves FRP.
Defines APMCs as state market regulators that manage mandis and first-sale marketing activities (including sugar) rather than central price fixation.
A student can combine this with the above that government announces FRP to infer APMC's role is market regulation, not national price approval—then verify legal mandates of APMC acts versus FRP notifications.
- [THE VERDICT]: Sitter. This is fundamental static Economy/Agriculture governance. Source: Vivek Singh (Ch 10) or Nitin Singhania (Ch 9).
- [THE CONCEPTUAL TRIGGER]: Agricultural Pricing Policy & Food Management (The distinction between MSP and FRP).
- [THE HORIZONTAL EXPANSION]: Memorize the Chain: 1) MSP: Recommended by CACP → Approved by CCEA. 2) FRP (Sugarcane): Recommended by CACP → Approved by CCEA. 3) Statutory Basis: FRP is legally binding (Essential Commodities Act/Sugarcane Control Order, 1966), whereas MSP is administrative/executive only. 4) SAP (State Advised Price): Announced by State Govts (usually higher than FRP).
- [THE STRATEGIC METACOGNITION]: Never just memorize 'MSP exists'. Always map the administrative workflow: Calculation (Technical) → Recommendation (Advisory Commission) → Approval (Political Cabinet). UPSC targets the specific node in this chain.
References explain that FRP is distinct from MSP and is specifically used for sugarcane while MSP applies to other mandated crops.
High‑yield concept for UPSC: questions often test the difference between price mechanisms (MSP, FRP, SAP). Mastering this clarifies which crops are covered, who pays (government vs mill owners), and policy implications. Prepare by comparing definitions, legal/operational differences, and past examples.
- Indian Economy, Vivek Singh (7th ed. 2023-24) > Chapter 10: Agriculture - Part I > 10.3 Minimum Support Price (MSP) > p. 306
- Indian Economy, Nitin Singhania .(ed 2nd 2021-22) > Chapter 9: Agriculture > MINIMUM SUPPORT PRICE > p. 328
- Indian Economy, Nitin Singhania .(ed 2nd 2021-22) > Chapter 9: Agriculture > Objectives of MSP include: > p. 329
Evidence shows ministries or statutory bodies recommend prices (Ministry/CACP) and higher executive bodies (CCEA) give approval for announced prices.
Important for governance and polity–economy questions: UPSC often asks which agencies recommend versus who approves policy actions. Knowing the chain (CACP/Ministry → CCEA) helps answer procedural and institutional questions; study official roles and past approvals.
- Indian Economy, Vivek Singh (7th ed. 2023-24) > Chapter 10: Agriculture - Part I > 10.3 Minimum Support Price (MSP) > p. 305
- Indian Economy, Vivek Singh (7th ed. 2023-24) > Chapter 10: Agriculture - Part I > 10.3 Minimum Support Price (MSP) > p. 306
References reference the Sugarcane Control Order under the Essential Commodities Act as the legal framework binding mill owners to FRP/SAP.
Useful for questions on legal/regulatory frameworks in agricultural policy: connects price fixation to statutory orders and central regulatory powers. UPSC aspirants should link statutes to market interventions and practice by mapping laws to commodities.
- Indian Economy, Vivek Singh (7th ed. 2023-24) > Chapter 10: Agriculture - Part I > 10.3 Minimum Support Price (MSP) > p. 306
- Indian Economy, Vivek Singh (7th ed. 2023-24) > Chapter 12: Supply Chain and Food Processing Industry > Introduction: > p. 367
References distinguish MSP (procurement price announced on CACP advice) from FRP (price specific to sugarcane paid by mills and recommended by a different ministry).
High-yield concept for UPSC: questions often ask which prices are fixed/recommended by which bodies and the legal/operational difference between MSP and FRP. Master by tabulating each price-type, who recommends/fixes it, who pays it (government vs private buyers), and linked schemes (procurement, PDS).
- Indian Economy, Vivek Singh (7th ed. 2023-24) > Chapter 10: Agriculture - Part I > 10.3 Minimum Support Price (MSP) > p. 306
- Indian Economy, Nitin Singhania .(ed 2nd 2021-22) > Chapter 9: Agriculture > MINIMUM SUPPORT PRICE > p. 328
- Indian Economy, Nitin Singhania .(ed 2nd 2021-22) > Chapter 9: Agriculture > Objectives of MSP include: > p. 329
Evidence shows CACP recommends MSP and approval by CCEA is part of the MSP process; relevant to determining whether CACP handles FRP.
Frequently tested institutional role: UPSC asks about mandate and functions of policy bodies (CACP, CCEA). Aspirants should memorize CACP's remit (recommendation of MSP) and the approval route (CCEA), practice by mapping institutions to specific price mechanisms.
- Indian Economy, Vivek Singh (7th ed. 2023-24) > Chapter 10: Agriculture - Part I > 10.3 Minimum Support Price (MSP) > p. 305
- Indian Economy, Nitin Singhania .(ed 2nd 2021-22) > Chapter 9: Agriculture > Objectives of MSP include: > p. 329
One reference explicitly attributes recommendation of FRP for sugarcane to the Ministry of Consumer Affairs, Food & Public Distribution, distinguishing it from CACP's remit.
Useful for questions that probe which ministry/body recommends/fixes commodity-specific prices (e.g., sugarcane). Learn by noting ministry-level responsibilities for key crops and how state-advised prices (SAP) interact with central FRP.
- Indian Economy, Vivek Singh (7th ed. 2023-24) > Chapter 10: Agriculture - Part I > 10.3 Minimum Support Price (MSP) > p. 306
- Indian Economy, Nitin Singhania .(ed 2nd 2021-22) > Chapter 9: Agriculture > Objectives of MSP include: > p. 329
References distinguish FRP (specific to sugarcane and paid by mill owners) from MSP (government procurement price), clarifying the different pricing instruments involved.
High-yield concept for UPSC: questions often ask differences between price-support mechanisms (MSP, FRP, SAP). Mastering this helps answer policy/administration and agricultural-economy questions; connect to procurement policy, market interventions and edible-commodities governance. Prepare by tabulating definitions, agencies involved, and who pays/receives each price.
- Indian Economy, Nitin Singhania .(ed 2nd 2021-22) > Chapter 9: Agriculture > MINIMUM SUPPORT PRICE > p. 328
- Indian Economy, Nitin Singhania .(ed 2nd 2021-22) > Chapter 9: Agriculture > Objectives of MSP include: > p. 329
- Indian Economy, Vivek Singh (7th ed. 2023-24) > Chapter 10: Agriculture - Part I > 10.3 Minimum Support Price (MSP) > p. 306
The 'Ministry' Trap: While CACP recommends the price, Sugarcane falls under the administrative control of the Ministry of Consumer Affairs, Food & Public Distribution, NOT the Ministry of Agriculture (which handles MSP for other crops). This is why the 'Sugarcane Control Order' is crucial.
Hierarchy Hack: Look at the verbs implied. 'Approve' implies final decision-making power and financial burden. A 'Commission' (Option B) is advisory. A 'Directorate' (Option C) is bureaucratic/implementing. A 'Committee' (Option D - APMC) is local. Only a 'Cabinet Committee' (Option A) has the political mandate to approve national prices.
Mains GS-3 (Agriculture/Economy): Link FRP to 'Sugar Arrears'. Because FRP is high (political) and sugar prices are market-linked (low), mills fail to pay farmers. This necessitates the 'Ethanol Blending Programme' (EBP) to divert surplus cane and ensure liquidity for mills.