Why are farmers protesting against laws which will supposedly 'help them'? And why is no one talking about the details of implementation?

[prasad1]

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Over the last week many of you have asked me to write on this particular topic. One gentleman even suggested on Twitter, perhaps sarcastically, that I was slacking. (I guess after this 3,800 word piece, he will clearly not say that).

Well, I wasn’t slacking. This is a complicated topic with multiple issues and because of that I was trying to read as much as I could, before offering my views on the issue. (Also, I might be writing more on the issue in the days to come).

What do the Bills which have been passed by the Parliament seek to achieve?

Yesterday, the Rajya Sabha passed two out of the three Bills being referred to as the Farm Bills. These two Bills are the Farmers’ Produce Trade and Commerce (Promotion and Facilitation) Bill, 2020, and the Farmers (Empowerment and Protection) Agreement on Price Assurance and Farm Services Bill, 2020.

The Lok Sabha had already passed these Bills. There was some ruckus in the Rajya Sabha where the Bill was passed through a voice vote.

The Farmers’ Produce Trade and Commerce (Promotion and Facilitation) Bill, 2020, allows the farmers to sell their produce outside the Agricultural Produce Market Committee (APMC) regulated markets. The APMCs are government controlled marketing yards or mandis.

This law allows farmers to sell their produce to cold storages, warehouses, processing plants or even directly to the end consumer (you and I, restaurants, hotels etc.) The state government is not allowed from levying any market fee, cess or any other levy in these other market places (or trade areas). In short, anything that the state government can do is limited to the physical area of the APMCs. The Bill allows intra-state trade and inter-state trade.

So, the farmers clearly have more choice on who they want to sell. But they are still unhappy about it? Why? This is a question that will get answered in the piece.

Now let’s take a look at the other Bill. The idea behind Farmers (Empowerment and Protection) Agreement on Price Assurance and Farm Services Bill, 2020, is essentially to create a framework for contract farming. This needs an agreement between the farmer and a buyer, before the production happens.

Of course, this hasn’t gone down well with the farmers either.

Why are farmers protesting against laws which will supposedly 'help them'? And why is no one talking about the details of implementation?

The fear among farmers is that the next step in the agriculture reform process will be the doing away of government procurement process as well as the MSP

www.firstpost.com

 

[prasad1]

Why are the farmers protesting?

The passage of both the Bills hasn’t gone down well with the farmers. In fact, farmers in Punjab, Haryana and Western Uttar Pradesh, had been protesting even before the Bills were passed by the Parliament. Why has that been the case? Let’s take a look pointwise.

1) As mentioned earlier, the farmers of Punjab, Haryana and Western Uttar Pradesh, are the ones, primarily protesting. Hence, farmers across the country are not protesting against these Bills.

The farmers of these states are primarily protesting because the government procurement infrastructure in these areas is very good. This is primarily because the Green Revolution of the 1960s started here. In order to encourage farmers to adopt a new variety of wheat, the government offered procurement through the Food Corporation of India and a minimum support price (MSP) to farmers, which was declared before every agriculture season. Since then the system has evolved and the government sets an MSP on 23 agricultural crops, though it primarily buys only rice and wheat. In the recent years, it has bought some pulses and oilseeds as well.

The fear among farmers is that the next step in the agriculture reform process will be the doing away of government procurement process as well as the MSP. This is going to primarily hurt the farmers from Punjab and Haryana, who benefit tremendously from this.

2) The farmers who benefit from the government procurement process and MSP are medium and large farmers. As the document titled Price Policy for Rabi Season—The Marketing Season of 2020-21, published by the Commission for Agricultural Costs and Prices 2020-21, which is a part of the Agriculture Ministry points out: “As indicated by data received from some states, medium and large farmers occupy a major share in total procurement in the State and share of small and marginal farmers, though improved during last few years, remain low.”

Hence, it’s the bigger farmers who are protesting against the passage of these Bills. (It is important to make this distinction because the media is largely using the word farmers).

Why are farmers protesting against laws which will supposedly 'help them'? And why is no one talking about the details of implementation?

The fear among farmers is that the next step in the agriculture reform process will be the doing away of government procurement process as well as the MSP

www.firstpost.com

 

[prasad1]

To conclude, the central government clearly hasn’t gone into the details of what will it take to really make the life of an average farmer better. As usual it is only interested in selling the narrative that the passage of these Farm Bills will ensure that farmers get a better price for what they produce. (Remember, the 50% higher MSP story they tried selling sometime back?)

When it comes to the opposition parties, they have managed to get low-hanging fruit to put the government on the mat after a while, and not surprisingly, they are cashing in on that.

Meanwhile, nobody is really worried about the farmer.

Why are farmers protesting against laws which will supposedly 'help them'? And why is no one talking about the details of implementation?

The fear among farmers is that the next step in the agriculture reform process will be the doing away of government procurement process as well as the MSP

www.firstpost.com

 

[prasad1]

Anger against the three farm laws legislation has been simmering against September, ever since the government passed the three agricultural bills. The bills collectively seek to provide farmers with multiple marketing channels, break several monopolies, including that of government-regulated mandis (market yards), and provide a legal framework for farmers to enter into pre-arranged contracts among other things.

For the last few days, thousands of farmers from Punjab, Haryana, Rajasthan and Uttar Pradesh have been marching towards the national capital and have started to assemble at the borders. The farmers, through the Dilli Chalo march, have decided to mount pressure on the government to rollback the recently-passed farm laws, and have started to gather at various entry points of the national capital, including Tikri and Singhu borders.

The farmers are demanding the Centre to either withdraw the three legislations or guarantee them on Minimum Support Prices (MSP) on their crops by passing a new law framed after wider consultation with the stakeholders. The farmers are against the Farmers' Produce Trade and Commerce (Promotion and Facilitation) Act, 2020, Farmers (Empowerment and Protection) Agreement on Price Assurance and Farm Services Act, 2020 and Essential Commodities (Amendment) Act, 2020.




Farmers have expressed apprehension that the new laws would pave a way for the dismantling of the minimum support price system, leaving them at the mercy of big corporates.

However, the Centre has been making all the attempts to assuage the protesting farmers, reiterating time and again that the new farm laws will not only help farmers increase their income but also free them from the clutches of middlemen.

Punjab farmers, representing over 30 farm bodies, announced that on November 26 and 27, they would go towards Delhi through many routes, including Lalru, Shambhu, Patiala-Pehowa, Patran-Khanauri, Moonak-Tohana, Ratia-Fatehabad and Talwandi-Sirsa to protest against the new farm laws besides pushing for other demands.

Of these 31, 13 farm unions have direct or indirect allegiance to communist parties. The rest are linked to Shiromani Akali Dal, Congress besides the mainstream farmer unions.

The first law is related to the Agriculture Produce Markets Committee (APMC). Under this law, farmers will be able to sell their crops to other buyers besides government mandis. It also gives the provision of selling their produce in other states. More interestingly it allows the farmers to sell their produce online. But the protesting farmers argue that the central government wants to end the current system of minimum support price.

Due to this bill, the revenue earned by the states in the form of market fees will drop drastically. About 13 per cent of the total revenue earned by the Punjab government comes from these mandis. There is also an argument that this will bring an end to middlemen in the mandis.

There are two more bills but the farmers are mainly concerned about the Agriculture Produce Markets Committee (APMC). The farmers fear that this bill will end the Minimum Support Price (MSP) of their produce guaranteed by the government every year.

Explained: Why are Punjab, Haryana farmers protesting in Delhi and what are their demands

Anger against the three farm laws legislation has been simmering against September, ever since the government passed the three agricultural bills. The bills collectively seek to provide farmers with multiple marketing channels, break several monopolies, including that of government-regulated...

zeenews.india.com

 

[prasad1]

Farm reforms — how both sides faltered
While the Centre should have allowed a longer legislative process, agitators should not have disrupted lives and caused inconvenience to other citizens.

Over the past fortnight, the agitation against the Centre’s agricultural reforms — led primarily by land-owning farmers of Punjab, but now supplemented by a range of other farmer groups — has assumed a political, economic and regional element. Irrespective of how the issue is eventually resolved, the protests throw open questions about the trajectory of India’s political economy and developmental model, the role of the State and markets in a sector that employs the largest number of people in the country, Centre-state relations, and the future of politics in rural India in general but Punjab in particular.


But the issue has also highlighted the strengths and weaknesses of the two key actors involved in the issue — the government as well as the agitators. What have they done right, and where have they gone wrong?

Take the government first.

The Narendra Modi government — as this newspaper has argued — did well in turning the crisis presented by the pandemic into an opportunity for reform. Indeed, Indian economic policymaking experience shows that it is in moments of crisis that reforms are most politically feasible, giving room to governments to challenge status quo. If it was not for the balance of payment crisis in 1991, it is doubtful if the PV Narasimha Rao-Manmohan Singh duo would have been able to push far-ranging and necessary reforms which liberalised India, integrated it with the world, boosted growth rates, unleashed the animal spirits in the private sector, expanded the middle-class, enriched the government through additional revenues leading to enhanced welfare spending, and lifted millions out of poverty.


But one sector which was largely immune to the trajectory of reforms was agriculture. No agricultural expert can today argue with any justification that status quo is tenable. The structural issues in Indian agriculture need not detain us here — but the mismatch between agriculture’s contribution to GDP and the number of people dependent on it is enough to show that urgent reforms were essential. And that is why the Modi government acted with the right intent in reframing how agricultural produce in the country can be procured and traded. It broke the monopoly of the mandi system, enabled greater interface between agriculture and industry by allowing structured corporate participation, and increased the freedom and choices available to farmers. This has the potential of enhancing farm incomes, infusing more capital in the sector, enabling diversification and possibly paving the path for the modernisation of India’s rural economy.

Farm reforms — how both sides faltered - columns - Hindustan Times

 

[prasad1]

But if it was right in its intent, as well as the overall substance of the law, the government faltered in building wider consensus around reforms.

Do remember that the Bharatiya Janata Party (BJP)-led government has had a somewhat paradoxical relationship with farmers in general. On one hand, it has faced fierce opposition from a range of farmer groups on diverse issues — from its proposed amendment to the land acquisition act to the demand to implement the MS Swaminathan Committee recommendations on minimum support prices (MSPs). At the same time, through a range of policy measures — the PM-Kisan scheme which enables direct cash transfer to small and marginal farmers; the focus on rural India in terms of construction of homes and toilets, and provision of gas cylinders; occasional promises of loan waiver in states which it is in power (Uttar Pradesh in 2017); a genuine attempt to boost agri-infrastructure — it has also won the support of a large segment of farmers. So, in a sign of the heterogeneity of farmers and their aspirations, it is useful to remember that while segments have been upset, others have also voted overwhelmingly for the BJP in elections.


But the Centre should have recognised that precisely because of this heterogeneity, there was a large constituency which could be uncomfortable with reforms and had the strength to express it. And that is why the farm reforms should have been preceded by much wider consultation in the public sphere. The government’s big mistake was in not allowing the farm bills to go through the parliamentary committee route — stakeholders would have not only got a chance to express their views and concerns, but it would have added legitimacy to the process. And even if this meant some delay, the democratic participation within the constitutional framework was worth it. The government also clearly underestimated the depth of anger, especially in Punjab, even though it was apparent that given the well-entrenched mandi system and the more widespread procurement of produce at MSP in the state, resistance could be fierce. The Centre’s actions led to the perception of unilateralism and only alienated those sceptical of the reforms further, providing the ground for a sustained movement.

Farm reforms — how both sides faltered - columns - Hindustan Times

 

[prasad1]

But what about the agitators?

Irrespective of whether one agrees or disagrees with the farm reforms, there is no doubt that the farmers are within their rights to express their opposition to measures which they believe will hurt their economic interests. There is genuine apprehension at being left to the mercy of market forces without adequate protection. Farm unions have also done a remarkable political job in spreading their message down to the ground, forcing the entirely spectrum of political actors in Punjab and now nationally to support their demands, and registering their dissent. They have also built a remarkable coalition of diverse interests — though it is somewhat ironical to see those who would have been otherwise categorised as feudal elements in agriculture and Left farm unions and even economic liberals who have, in the past, argued for more openness in agriculture — come together because they oppose the BJP. This may be hypocrisy, but it is also clever politics.


But where the farmers have faltered is in the method and idiom of the protests.

Any interest group in a democracy has the right to oppose the government peacefully and through constitutional methods. But this cannot be at the cost of undermining the rights of fellow citizens. To gain leverage in negotiations with the State, protesters have been inflicting costs on society — by blocking highways and the right to free movement and disrupting supply chains and the right to trade. This has not only caused inconvenience but also led to inflationary consequences, the brunt of which is borne by the poor. It is easy for protesters, when they are in the middle of a movement, to think they have the edge and underestimate the State. And while the context is entirely different, farm unions would do well to remember that the anti-Citizenship (Amendment) Act protests eventually lost their moral high ground because of obstructionist tactics. The other big weakness of the movement is in its maximalist posture — of seeking nothing less than a repeal of the laws — instead of being open to compromise.


Indeed, it is only through this political process of negotiation that both reforms can succeed and interests of those fearful of reforms can be safeguarded. Both the Indian State as well as dissenting citizens are on test.

Farm reforms — how both sides faltered - columns - Hindustan Times