New Delhi, Apr 25 (IANS): The Cabinet Committee on Economic Affairs (CCEA) on Wednesday increased the Minimum Support Price (MSP) of raw jute from Rs 3,500 to Rs 3,700 per quintal for the present fiscal.

The decision was taken at a meeting chaired by Prime Minister Narendra Modi.

"The MSP for Fair Average Quality (FAQ) of raw jute has been increased to Rs 3,700 per quintal for 2018-19 season from Rs 3,500 per quintal in 2017-18 season," an official release said.

It said the MSP would yield returns of 63.2 per cent over the weighted average A2+FL cost of production.

The increased MSP is based on recommendations of Commission for Agricultural Costs and Prices (CACP).

The release said that Jute Corporation of India would continue to act as the central nodal agency to undertake price support operations at the MSP in the jute growing states.

"The MSP of raw jute is expected to ensure appropriate minimum prices to the farmers and step up investment in jute cultivation," it said.