The farmers strike and protest that started in August 2020 hasn’t stopped yet. While the Government claims the new farm laws are a much-needed reform, the Kisan protest says that these are three black laws against farmers.
On 26 January, 2021, when India was celebrating its 72nd Republic Day, the national capital was stormed by dissatisfied farmers to manifest their anger and discontentment towards the three farm reforms. One farmer died in the ensuing chaos and scores of them have died in the chilling winters of Delhi while peacefully protesting on borders for the annulment of these laws.
These laws, which gave birth to one of the largest farmer protests in India, were passed by the parliament through an ordinance at the time when the country was more or less in lockdown. The three Farm reforms, as the Government claims, are the door to globalisation and privatisation for farmers who until now have limited themselves to the local Mandi’s.
The farmers are still protesting but a look at the news channels, and you’d think everything was resolved. #FarmersProtest #FarmerLivesMatters https://t.co/0gSGZRG9VT
— Youth Ki Awaaz (@YouthKiAwaaz) April 19, 2021
These laws are also supposed to expedite farm sector growth through private sector intervention leading to infrastructure building. However, notwithstanding the above attributes, on 9 August, 2020, the farmers of Punjab and Haryana began one of the largest protests of the republic of India calling the above the “corporate-friendly and anti-farmer” bills.
What Are The Three Agriculture Bills?
When explained, the first farm act, the Farmers’ Produce Trade and Commerce (Promotion and Facilitation) Act emerges to widen the scope of trade areas of farmers’ produce from select areas to “any place of production, collection, aggregation”, allows e-trading on selected produce, prohibits states government from levying any market fee for the trade of farmers’ produce conducted in an “outside trade area”.
The second farm act, the Farmers (Empowerment and Protection) Agreement of Price Assurance and Farm Services, would allow contract farming and provide a dispute resolution mechanism for the same.
The third farm act, which is an amendment to the Essential Commodities Act of 1955, removes foodstuff: cereals, pulses, potatoes, onions, edible oilseeds and oils from the list of essential commodities. The new provisions also put an end to the existing stock holding limits on such items except under “extraordinary circumstances”.
Why Is The Kisan Bill Being Opposed?
Farmers fear that the Agricultural Produce Market Committees (APMC) and Minimum Support Price (MSP), established by the state governments in 2003, would be dismantled after implementing the three farm reforms.
These APMCs provide a channel for farmers to sell their produce via auction, protecting the farmers from exploitation by the intermediaries who force them to sell products at extremely lower prices. The wholesale traders, retailers and mall owners are not permitted to buy products from such markets.
In addition, the MSP is an agricultural product price set by the Government of India to purchase directly from the farmer that safeguards the farmer to a minimum profit for the harvest. If the open market has a lesser price than the cost incurred, which is being suspected under threat as the new laws open the field for private sector intervention, there will be no statutory obligation to purchase the goods at MSP.
Moreover, no fee will be charged for outside trade areas. The purchasing would apparently shift to private yards from APMC markets leading to the eventual dependency of farmers on the benevolence of giant corporates.
Kiran Kumar Visa of the Rythu Swarajya Vedika said, “Once restrictions are removed, big companies like Adani, Reliance and Walmart can build huge processing and storage lines, which will ensure their market domination. In the process, the small farmers will have no bargaining power, and in fact, will ultimately get lesser prices for their crops.”
The new provision of a grievance redressal mechanism also dismisses the farmers’ possibility of reaching out to the judiciary in case of a major breach with respect to the agro-trading affairs.
Another alarming concern is that the new amendment removed certain essential commodities previously proscribed for stocking and hoarding, effectively facilitating their hoarding. This might lead to a price rise and disrupt the public food distribution system.
On What Grounds Is The Government Defending The New Farm Laws?
The Government is actively defending the law on the grounds of freeing the farmers from the so-called clutches of the APMC. It is being argued that these laws will eventually lead to a better price choice due to an increase in competition among multiple buyers. In addition to that, the deletion of intermediaries from the supply chain would reduce the retail price for consumers.
On the other hand, if we look at Bihar, where APMCs shut down 14 years ago, the farmers have to sell their produce at meagre prices.
“Before the scrapping of the APMC Act, farmers would sell their produce to the market committees where the minimum support price was guaranteed. But after the repeal of this system, they indulged in distress sale lest their produce would go to waste because they had no storage facility,” says economist Abdul Qadir.
While the net income of farmers increased from 2007 to 2010, it has declined from 2007 onwards despite the increase, according to the report of the National Council of Applied Economics Research, 2019, that studied the impact of Bihar’s Farm policies on the ground.
Several farmers have said that they are selling their products at a constant loss, and it’s difficult for them to repay the loans, “I invested ₹12,000 in farming this season but got only ₹8,000 after selling paddy. I incurred a loss of ₹4,000,” said Naresh Murmu, a farmer from Jamui district.
Paddy has sold for ₹900–₹1,000 a quintal in Bihar, almost half the ₹1,868 fixed by the Centre as MSP, alleged the former director of Patna-based AN Sinha Institute of Social Studies. He added that nearly half the farmers couldn’t even recover their investments.
It’s being feared that these laws are nothing but another failed “one-night revolution” reform of the Modi Government like the Demonetisation and Goods and Services Tax (GST) Act.
A significant question to be answered here is if Bihar’s 2007 APMC scrapping was so successful that it could be amplified in all the other states, why is Bihar still among the worst agri-dependent states in India? Why isn’t the Indian Government thinking of subsidising agriculture like the U.S. rather than corporatisation if reform is the need of the time?