By Rajendra Jadhav and Mayank Bhardwaj
       MUMBAI/NEW DELHI, June 19 (Reuters) - India on Wednesday
raised the government-mandated price for summer-sown crops such
as rice, soybean and cotton as Prime Minister Narendra Modi
looks to woo millions of farmers ahead of key state elections
later this year.
    The country announces support prices for more than a dozen
crops each year to set a benchmark. But analysts say the hike
could hit government finances and also lift food inflation.
    India has raised the price at which it will buy new-season
common rice paddy from farmers by 5.4% to 2,300 rupees ($27.57)
per 100 kg, the information minister Ashwini Vaishnaw said on
Wednesday after a cabinet meeting chaired by Modi.
    Higher prices will encourage farmers to boost output in the
world's second-biggest rice producer, and bountiful harvests
could encourage the government to relax a ban on some exports.
India is the world's biggest exporter of rice.
    The paddy buying price has been raised to reflect the rising
cost of production, which will encourage farmers to boost
production, said B.V. Krishna Rao, president of the Rice
Exporters Association of India.
    "However, this will also make Indian rice more expensive for
overseas buyers. To mitigate this, the government should reduce
the export duty from 20% to 15%," Rao said.
    India has imposed a 20% duty on exports of parboiled rice
after banning shipments of white rice last year.
    Every year authorities raise the support prices of staples
such as rice and wheat to build stockpiles to run the world's
biggest food welfare programme, which entitles poor people to
free grains.
    Modi's Bharatiya Janata Party (BJP) failed to secure a
majority on its own in the recently held general elections,
losing more than six dozen seats in rural areas.
    The BJP faces provincial elections later this year in two
key agricultural states, Haryana and Maharashtra, which have
strong farm lobbies. 
  
    New support prices of key crops in rupees per 100 kg
 Crop          New support price  Old support price
 Rice          2300               2183
 Cotton        7121               6620
 Soybean       4892               4600
 Corn          2225               2090
 Ground nut    6783               6377
 Pigeon peas   7550               7000
 ($1 = 83.4101 Indian rupees)

 (Reporting by Rajendra Jadhav and Mayank Bhardwaj; Editing by
David Goodman and Leslie Adler)