Neither malignant nor miraculous, farm bills are an exercise in status quo

Navneet Mundhra
·5-min read

In the wake of fervent protests by farmers and a host of organisations, the Congress government in Punjab last week passed three farm amendment bills in a bid to repudiate and remove Punjab from the purview of the recently-passed farm legislations by the Narendra Modi government at the Centre.

During the monsoon session of the Parliament, the Centre ushered in three agriculture sector bills: The Farmers’ Produce Trade And Commerce (Promotion And Facilitation) Bill, The Farmers (Empowerment and Protection) Agreement on Price Assurance and Farm Services Bill, and The Essential Commodities (Amendment) Bill. The passing of these bills elicited stinging criticism from the Opposition and riled up some farmers.

Getty Image
Getty Image

The Bharatiya Janata Party leaders have time and again said the purpose of these bills is:

i) to allow farmers to sell their produce outside the government-regulated Agriculture Produce Market Committees (APMCs) at the price of their own choice, ii) to enable them to get into contract with private parties or companies to produce for them, and iii) to remove government's restrictions on stocking food articles.

While some experts hailed it as a revolutionary step to unshackle the farming community, many were displeased. The Opposition typically accused the Centre of conspiring to abolish APMCs and Minimum Support Price (MSP), a charge which the Modi government vehemently denies.

The protests by farmers, however, were limited to Punjab, Haryana & Western Uttar Pradesh, and didn't find resonance in the rest of the country. Reasons for this are legion. First of all, there are almost 7,000 agriculture produce market committees in India but they are not even spread across the country. APMCs are well-maintained and highly operational in Punjab, Haryana and Western UP, but in the rest of the country, APMCs are either sparse, not well-connected or far between.

Most of the farmers outside these regions have been selling their produce outside APMCs anyway all these years. So the trepidation of abolition of APMCs hasn't affected farmers in the rest of the country.

Punjab, Uttar Pradesh and Haryana rank among the highest producers of wheat and paddy in the country. And it is these crops which the government procures the most at the MSP. The government procured 43.28% production of paddy and 36.24% of wheat in the country at the MSP, which is significantly higher than procurement percentage of other crops.

The Centre at present has fixed MSPs for 23 farm commodities but the percentage of procurement of wheat and paddy at MSP is significantly higher than other commodities. Since Punjab, Haryana, UP are at the forefront of producing these crops, the farmers of these states are fearful of missing out on the MSP. In the rest of the country, most of the farmers are accustomed to selling their produce below the fixed MSP and hence aren't up in arms.

The powerful arhtiya (middleman) lobby is also behind fuelling the protests in these states. In Punjab there are 28,000 licensed arhtiyas, inextricably linked to the system. They act as a link between the farmers and the government and charge their commission.

Many of them also act as moneylenders and provide financial succour to farmers. Their proximity to the politicians and well-established relations with farmers render them hugely influential in these regions. Apprehensive about their hegemonic hold being scuttled, they have been actively fuelling and financing farmers' protests in these states.

The state government of Punjab earns nearly Rs 3,500 crore from APMCs through taxes, cess and levies imposed on the transactions taking place in the APMCs.

Farm issues are so central to the politics of Punjab that the Shiromani Akali Dal (SAD), the longest ally of the Bharatiya Janata Party, walked out of the BJP-led National Democratic Alliance fold over the farm bills issue.

Now, the passing of farm amendment bills by Punjab Chief Minister Amarinder Singh is ostensibly a move to rally around farmers. However, the implementation of these bills, counterforce to the laws passed by the Centre, will depend upon the consent of the President which isn’t forthcoming. Hence, it would remain, at best, a symbolic political move.

While there is no mention of abolition of APMCs or MSP in the agriculture-sector legislations ushered in by the Centre, the protests are driven by the fear stoked by the Opposition with a clear agenda. The bills themselves aren't really revolutionary as claimed by the BJP and its leaders.

As mentioned above, most of the farmers outside these regions have been dealing with the private parties and companies since the government procurement and state of APMCs aren't robust. So these bills bring little or no relief for them. For them, it's just status quo.

The government would have done well to make it legally binding for private entities and government's procurement agencies to buy the produce from the farmers only at the MSP anywhere in the country. Making any enterprise, private or government, liable to punishment if they procure any crop below the stipulated MSP would have been manna from heaven to farmers of all states.

At present, not more than 20-25% farmers in the country, that too mostly in Punjab and Haryana, get MSP on their produce. There is also the need to expand the net of MSP beyond the 23 crops and also the percentage of procurement by the government agencies.

Sadly, the farm bills fail to address these long-standing and festering issues of the farmers.

Neither malignant nor miraculous, the farm bills passed by the Centre are largely an exercise in status quo.

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