Enough has been said and read about the new Indian Agriculture Act, commonly referred to as the Farm Act. And yet, most of it is ambiguous or extremely technical for a layman to understand. The President assented to the bills on 27th September 2020. Ever since, several farmers have been out on the streets protesting the Act for its recent amendments. However, the Government has strongly conveyed that the Act is for the good of the Farmers. Let’s quickly understand both sides of the story –

What are the Farmers protesting for?

The primary reasons behind the protest are the 3 Farm Ordinance that was passed:

(1) The Farmers’ Produce Trade and Commerce (Promotion and Facilitation) Bill, 2020, and

(2) The Farmers (Empowerment and Protection) Agreement on Price Assurance and Farm Services Bill, 2020.

(3) The Essential Commodity Bill

The Farmers’ Produce Trade and Commerce (Promotion and Facilitation) Bill, 2020:

With this bill, the farmers could sell their produce outside APMCs, i.e. Agricultural Produce Market Committee, also commonly known as Mandis. This can bring forth better opportunities for farmers. The Government sees APMCs as an obsolete body that was once made to protect farmers.

The Farmers (Empowerment and Protection) Agreement on Price Assurance and Farm Services Bill, 2020:

This bill sets up the framework of contract farming, but what is contract farming? Well, just like any other contractual transaction, an ordained buyer and a farmer can be a part of a deal before the production begins.

Essential Commodities (Amendment) Bill 2020: 

The Farmers’ Produce Trade and Commerce (Promotion and Facilitation) Ordinance, 2020, would allow inter-state and intra-state trade of farmers’ produce beyond APMC markets. The State governments would be prohibited from levying any cess, market fee, levy outside APMC areas.

What’s the Government’s say on it?

The Government claimed that the proposed amendments would transform Indian agriculture and attract private players, which will lead to heavier investments and growth. One of the ordinances proposes contracting farming, i.e. farmers can produce crops according to contracts with corporate investors and get a mutually agreed consideration.

The Farmer’s Produce Trade and Commerce (Promotion and Facilitation) Act, 2020, enables the farmers to sell their produce anywhere in India without any middleman in the picture. The Government sees APMCs as an obsolete body made to protect farmers; on the contrary, it has started oppressing the farmers and manipulating the prices by forming cartels, forcing distress sales.

So Why Are The Farmers Upset?

One of the reasons behind the protests is that the farmers fear big corporate investors manipulating the market for unfavourable returns. The farmers could be stuck in a contract with heavy liability clauses, and the inability to negotiate will, in turn, trouble the farmers. Their incompetence in understanding complicated clauses of a contract furthers the scope of backlash.

Another reason for the protest is that the Government will scrap a robust support system that is prevalent for the purchase of crops, MSP, i.e. Minimum Support Price, a safety net for the farmers since the Green Revolution 1960s. With MSP, the farmers were assured that if the farmers fail to sell their produce in the APMCs, the State Government will purchase the unsold produce at a Minimum Support Price.

Our Word:

The Act traces its inference from the west. The model has already failed in the west, which is evident with the increasing suicide percentage of farmers from the United States, Europe, United Kingdom. Since the 1960s, American and European agriculture has witnessed a steep decline and has survived on subsidies provided by the Government. Though APMCs have prominent loops, the same can be worked on and revised with a better-suited regulation. Or to have a well-enacted act in place which lays its grounds on Minimum Support Price, an upper cap for the private players that can curb overpricing, and a few other briefly scrutinized plans. 

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Author: Shweta Singh