Why agriculture products prices are maintained at low price?
Answer:
The reason behing this is that agriculture is a declining sector in short demand for agricultural goods is limited because there is only so much that people can eat. The only thing increasing food demand is population increase. Even if everyone had a massive income increase there is only so much food tehy could eat. On the other hand supply is constantly increasing due to new technology at a much faster rate than demand pushing prices downwards. For more detail check the two references below.
because of intermediate agency.
They are not maintained at low prices.
But the Govt. supports the agriculture by declaring a minimum purchase price i.e. if there is nobody in the market to purchase the produce above a particular fixed price, the Govt. guarantees the farmer to purchase the produce at a particular price.
This makes the farmer confident that his labor will not go waste and he will get at least the reasonable price for his produce.
Because the Govt. doesn't want the farmers to be rich.
So they can be easily affordable to all. Food is a staple that a country need to provide to everybody.
that is what i was wondering! a talcum powder tin without which human being still can live is costing Rs.40/= whereas a kg of rice without which human being cannot live is costing only Rs.10/=. with this price, how can a farmer live a dignified life?
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