The prices at which the Government of India purchases foodgrains from farmers to maintain the Public Distribution System (PDS) and build buffer stocks are known as what?

Introduction / Context:
India's food security system relies on the government buying foodgrains at assured prices and then distributing them through the Public Distribution System (PDS) or storing them as buffer stocks. Several price concepts are used in this process, including minimum support prices, procurement prices and issue prices. Exam questions often test whether you can distinguish among these terms. This question specifically asks for the name of the price at which the government actually purchases foodgrains for PDS and buffer stocks.

Given Data / Assumptions:

- The Government of India purchases foodgrains from farmers.- These purchases are meant for maintaining PDS and buffer stocks.- Several related price concepts are listed as options.- We assume familiarity with basic food policy terminology.

Concept / Approach:
Minimum support price (MSP) is the price announced by the government before the sowing season, assuring farmers that they will receive at least this price if the market price falls below it. Procurement price is the actual price at which government agencies like the Food Corporation of India (FCI) buy foodgrains from farmers. For many exam questions, procurement price is described as the price used to build buffer stocks and supply the PDS. Issue price is the subsidised price at which these grains are sold through fair price shops to ration card holders. Ceiling price and wholesale market price are different concepts altogether. Hence, the price at which the government purchases foodgrains for PDS and buffer stocks is known as the procurement price.

Step-by-Step Solution:
1. Identify that the question is about the price at which government actually buys grains for PDS and buffer stock formation.2. Recall that MSP is a policy guarantee and may act as a floor price, but the actual purchase price for government procurement is termed the procurement price.3. Recognise that issue price is the price at which grains are sold to consumers through PDS, not bought from farmers.4. Understand that ceiling prices refer to maximum price controls in general markets, and wholesale market prices are determined by open market forces.5. Conclude that procurement prices is the correct term for the government purchase price in this context.

Verification / Alternative check:
Many Indian economy and agriculture textbooks explain that the government announces both MSP and procurement prices. They often state that procurement prices are closely related to MSP, sometimes set equal or slightly higher, and are used for actual purchases for food security operations. Issue prices, on the other hand, are fixed for PDS sales. These definitions confirm that the term procurement price best fits the description given in the question.

Why Other Options Are Wrong:
- Minimum support prices: these are pre announced floor prices to protect farmers but not necessarily the exact price of every procurement operation.- Issue prices: refer to the price at which foodgrains are issued to consumers through PDS, not the purchase price from farmers.- Ceiling prices: are government imposed maximum prices in general markets, not specific to foodgrain procurement operations.- Wholesale market prices: are open market prices determined by demand and supply, and can differ significantly from government procurement prices.

Common Pitfalls:
A common source of confusion is that exam materials sometimes mention MSP in the same breath as government purchases, leading students to think that MSP is the direct purchase price. While MSP influences procurement prices, the term the government uses for the purchasing price is procurement price, especially in older exam questions. Another error is to confuse issue prices with purchase prices; remember that issue prices relate to sales to consumers. To avoid these mistakes, mentally link procurement price with government purchases and issue price with PDS sales.

Final Answer:
The prices at which the government purchases foodgrains for PDS and buffer stocks are known as procurement prices.