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Market Intervention Scheme (MIS) for perishables Photo: Ghulam Rasool · Pexels License · source ↗

Market Intervention Scheme (MIS) for perishables

The Market Intervention Scheme (MIS) is the Central Government's price-support instrument for agricultural and horticultural commodities that are NOT covered by MSP — typically perishable horticultural crops, condiments and minor commodities. It is operated by the Department of Agriculture & Farmers Welfare (DA&FW) on the request of a state government when prices crash 10% or more below the previous normal year. MIS now sits inside the PM-AASHA umbrella from the rabi 2018 season.

Scope and trigger

MIS is invoked when:

  • The crop is NOT in the 23-crop MSP basket (see MSP 23-crop list)
  • Mandi price drops 10% or more below the average price of the previous normal year
  • The state government formally requests central intervention and commits to its 50% share of losses

Typical MIS-eligible commodities: onion, tomato, potato (TOP basket), apple, kinnow, orange, garlic, ginger, turmeric, chillies, copra-on-shell, oil palm fresh fruit bunches, mushroom, areca nut.

Cost-sharing structure

Losses from MIS operations (procurement at the MIS intervention price minus the realised disposal price plus operational expenses) are shared 50:50 between Centre and state for general-category states and 75:25 (Centre:state) for North-Eastern and Himalayan states. The Centre's loss share is capped at 25% of the procurement value.

Operational mechanism

The state government appoints a state-level procurement agency — typically the State Marketing Federation, NAFED or State Horticulture Mission. The agency:

  • Opens procurement centres at notified mandis
  • Procures at the MIS intervention price (calculated to give producer a fair return)
  • Stores or moves stock for direct sale, processing, export or buffer
  • Disposes stock through tenders, retail outlets, mid-day meal schemes etc.

The Centre reimburses its loss share after final reconciliation.

Relation to PSF (Price Stabilisation Fund)

The Price Stabilisation Fund, operated by the Department of Consumer Affairs since 2015, sits alongside MIS but is targeted differently: PSF builds buffer stocks of onion and potato to moderate retail volatility, while MIS pays the farmer when prices fall. The two schemes were partially merged in the 2018 PM-AASHA recast.

Implementation in horticulture states

Karnataka, Maharashtra, Madhya Pradesh and Andhra Pradesh have repeatedly invoked MIS for tomato (see tomato price cycle) and onion glut years. Andhra Pradesh and Telangana also use it for chillies and turmeric.

Limitations

MIS is reactive — it kicks in after the price crash, and the procured stock often re-enters the same market or rots in storage. The 50:50 cost share leaves cash-strapped states reluctant to invoke it, and the 10%-below-normal trigger excludes slow secular price declines. PM-AASHA tried to integrate MIS, PSS and a Price Deficiency Payment pilot, but uptake outside oilseeds has been modest.

See also: Price Support Scheme, Price Deficiency / Bhavantar, MSP — Minimum Support Price, Tomato price cycle, MSP 23-crop list.

Sources

  1. MIS-PSS Operational Guidelines. Department of Agriculture & Farmers Welfare.
  2. Market Intervention Scheme. Press Information Bureau.
  3. PM-AASHA umbrella scheme. Press Information Bureau.