a. Farmers' Produce Trade and Commerce ( Promotion and facilitation),
b. The Farmers (Empowerment and Protection) Agreement on Price Assurance and Farm Services Bill and
c, The Essential Commodities (Amendments) Bill.
On 27 September, they got approval from the President of India, Ram Nath Kovind and became acts. Now you must be thinking what are these bills about ? Why so many farmers are protesting across the nation especially in Haryana and Punjab?
So, let me make it easy for you. We will start from beginning to end.
History
A. Pre - Independence India
Permanent Settlement
The Permanent Settlement came into effect in 1793 by General - Governor Lord Cornwallis. This was an agreement between the company and the Zamindars to fix the land revenues. This system was also called Zamindari system. The fixed amount was 10/11th portion for the government and 1/11th for the Zamindars. In this settlement, we can see that peasants were left at the mercy of Zamindars as Zamindars were now owners of the lands. The peasants had no rights over land and they could be replaced by Zamindars anytime.
B. After Independence
Green Revolution
A program under which high - yield varieties of wheat and rice were planted in the fields of poor farmers in order to eliminate hunger and poverty. Nevertheless, this program led to decline in the production of indigenous crops such as millets.
Land Fragmentation
The concept of land fragmentation means breakdown of a bigger land into small units. This is done when the land of a father breaks down into small units among his sons, which ultimately leads to low agricultural productivity and backward state of our agriculture. A lot of time and labour is wasted in moving seeds. The farm mechanization cannot be installed in the small lands.
These are all about history that how farmers of India were exploited by government, zamindars and British India Government.
Now we talk about farm bills, 2020.
1. FARMERS' PRODUCE TRADE AND COMMERCE (PROMOTION AND FACILITATION) ACT, 2020 :
MAIN PROVISIONS
A. The farmers and traders will enjoy freedom of choice of sale and purchase of agri-produce.
Earlier farmers were supposed to sale its products in the APMC ( Agricultural Produce Market Committee) only, but this provision is allowing farmers to sale its products as per own whims. There is no boundary of selling agri-products.
B. Will promote barrier- free inter - state and intra-state trade and commerce outside the physical premises of markets notified under State Agricultural Produce Marketing Legislations.
Now farmers are supposed to sale its products from one state to another, from one place to another within a state.
C. The farmers wil not be charged any cess or levy for sale of their produce and wil not have to bear transport costs.
The farmers will not suppose to pay any cess or levy that is good but what about transport cost? Do you really think that is it possible for farmers because farmers will, obviously have to pay the transport costs if they want to sale their products to APMC or some other place?
D. The bill also proposes an electronic trading in transaction platform for ensuring a seamless trade electronically.
This is not a new provision made by government because there are already a platform E-NAM where all APMCs are connected and the prices of all products are listed, where farmers can easily sell their products.
E. In addition to mandis, freedom to do trading at farmgate, cold storage, warehouse, processing units etc.
F. Farmers will be able to engage in direct marketing thereby eliminating intermediaries, resulting in full realization of price.
CLARIFICATIONS
There are some clarifications made the government of India:
A. Procurement at Minimum Support Price will continue.
B. Mandis will not stop functioning.
C. The e-nam trading system will continue in the mandis.
2. THE FARMERS (EMPOWERMENT AND PROTECTION)AGREEMENT ON PRICE ASSURANCE AND FARM SERVICES ACT, 2020
MAIN PROVISIONS
A. Farmers will be empowered for engaging with processors, wholessalers, aggregators, large retailers, exporters etc. On a level playing field Price assurance to farmers even before sowing of crops. In case of higher market price, farmers will be entitled to this price over and above the minimum price.
Through this provision government of India empowering the farmers of India to sale their products at higher prices, if the market price of the products are high. For instance, McDonalds visits a farmer and asks to produce that much quantity of the potatoes as much asked in the contract. And, if the market price of the potatoes are higher than the price listed in the contract then the farmer is entitled to sell its products at the market price.
B. It will also enable the farmers to access modern technologies, better seed and other inputs.
This provision is not possible until and unless the buyers of the products do not support the farmers because in accessing modern technologies, there are needed a lot of funds to spend in acquiring electricity, machines for irrigation etc. So there is will and desire of the buyers to provide all those facilities which enable the farmers to work smoothly.
C. It will reduce cost of marketing and improve income of farmers.
Here farmers are not supposed to market their products because there are already someone who are going to buy the products. Moreover, there is an assurance of the products.
D. Efferctive dispute resolution mechanism has been provided with clear time lines for redressal.
E. Impetus to research and new technology in agricultural sector.
CLARIFICATIONS
There are also some clarifications made by government.
A. The farmers wil have full power in the contract to fix a sale price of his choice for the produce. They will receive payment within next 3 days. It means that both the farmers and the buyers are standing on the same base.
B. 10000 farmers producer organizations are being formed throughout the country. These FPOs will bring together small farmers and work to ensure remunerative ricing for farm produce.
C. In case of dispute, there will be no need to go to court repeatedly. There will be local dispute redressal mechanism.
3. THE ESSENCIAL COMMODITIES (AMENDMENTS)ACT, 2020
MAIN PROVISIONS
A. Provisions to remove commodities like cereals, pulses, oilseeds, edible oils, onions and potatoes from the list of essential commodities.
It means that earlier when these products were listed in The Essential Commodities, there were some restrictions that you can not buy products above than a particular quantity of a product. This is so because if a buyer starts buying a particular product in a large quantity, it may be possible the supply of that particular product will go down and the price of that product will tend to rise.
B. The government, while liberalizing the regulatory environment, has also ensured that interest of consumers are safeguarded. It has been provided in the amendment, that in situation such as war, famine, extraordinary price rise and natural calamity, such agriculture foodstuff can be regulated.
EARLIER REFORMS IN AGRICULTURE SECTOR BY THE CURRENT GOVERNMENT
A. Agricultural Produce And Livestocks Marketing ( Promotion and facilitation) Act (APLM), 2017
a. It would be a major agricultural reforms as it provides wider options for farmers to sell produce and get better prices. As this provision is also provided in the 1st bill.
b. At present, farmers can sell their produce at regulated APMC ( Agricultural Produce Marketing Committee) mandis only. They are subjected to different kinds of fees.
c. The Government's aim is to set up a wholesale market at every 80kms. The new law will end the monopoly of APMC and allow more players to set up markets and create competition so that farmers can discover prices and sell their produce accordingly. Do we really have a wholesale market at 80kms or it is written in the law only?
B. Doubling the farmers Income by 2022.
C. Significant changes in fixation of MSP.
Whatever the recommendations made by the Swaminathan Committee in 2006. It said that whatever the weighted average cost of capital plus 50% profits would be MSP.
CRITICISM
1. As in the first bill, farmers produce trade and commerce ( promotion and facilitation) act, 2020. The farmers and traders will enjoy freedom of choice of sale and purchase of agri-produce. The same provision was also written in the Agricultural Produce And Livestocks Marketing ( Promotion and facilitation) Act (APLM), 2017. Now do you really think it is performed practically that there is a freedom for farmer to sell their products wherever they want to sell.
2. As also in the first bill, it is written that the farmers wil not be charged any cess or levy for sale of their produce and wil not have to bear transport costs. It is perfectly good for the farmers that they will not have to any cess but, on the other hand, it is not an easy task for farmers to carry their products from one place to another. Moreover, they will not have to pay transportation costs.
3. In the first bill, the government of India clarified that the MSP will remain to continue but my question is, MSP system has been working for 3 years, so let me know in how many products the MSPs are being provided to the farmers except Bajra? So even according to the existing law, the MSP is still not properly provided to the farmers, so what is the guarantee that MSPs will remain to continue when farmers will supposed to sell their products outside mandis?
4. Government should talk or consult to farmers union before making these bills into act.
WAY FORWARD
1. MSP must continue to exist not only in the mandis but also outside mandis. It will make farmers free from exploitation. As we know the cost of productions vary from region to region, for instance, cost of production of potatoes in Bihar is rs100, it may be rs120 in Tamil Nadu. So the MSPs of different regions should also vary according to the cost of production of that particular region.
2. The government should decrease control as they did through LPG. But, the government should also establish agencies and control mechanism so that farmers don’t get exploited but as per the requirements needed in 21st century. For instance, who will bear the cost if exports to be cancelled.
3. The APMC act came into existence to avoid farmers from exploitation because initially, farmers had not that much money to produce so they used to take loans from moneylenders. Farmers were unable to repay their loans, as a result, moneylenders used to take all their produces in own possessions. Now so many cartels of traders who are exploiting farmers. By removing APMC system, there is possibility that farmers would again get exploited by moneylenders. However, government should start a program with banks to provide financial assistance to farmers.
4. The government of India should provide subsidies in transportation cost to farmers.
5. Government should start an initiative to spread awareness among farmers about their rights. Educate them to read contracts because as per data revealed there are so many farmers who do not even know about MSPs. Like TV advertisement or media.
6. Government should wide spread the Rashtriya Krishi Vikas Yojana ( RKVY), Sub - mission on Agricultural Mechanization (SMAM) etc.
7. Farmers unions and government should come to a negotiation table to come to some conclusions.
A good article on farm bill. Thank you
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