Question

Explain Buffer stock scheme.

Answer 1

1. Buffer stock is the stock of food grains namely wheat and rice, which are stored in granaries.
2. It is procured by the Government through the FCI food corporation of India from the States of surplus production.
3. The farmers are paid a pre-announced price for their crops which is called as Minimum Support Price.
4. The minimum support price is announced by the Government every year before the sowing season.
5. This is to provide incentives to farmers for raising the production of these crops.
6. The Buffer stock is done to distribute food grains in the deficit areas among the poor people in the society.
7. Since the price is lower than the market price, it is also called the Issue Price.
8. The stored food helps to resolve the problem of shortage of food during adverse weather conditions or during periods of calamity.