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Agriculture Reform Bills 2020 | Reason behind Farmers’ Protest

Agriculture Reform Bills 2020

Agriculture Reform Bills – 2020 | Reason behind Farmers’ Protest

Recently, the central government of India has come forward with an amendment in three agricultural bills to pass the ordinance due to which the opposition political parties and mainly the farmers of Haryana and Punjab are upset and they have done a huge protest also. The government of India is claiming that these amendments will be a game-changer whereas the opposition is not at all supporting these bills. Everything have their pros and cons, people have to decide by themselves what is good and what is bad for them instead of listening to any political party. Let us have a look at the advantages and disadvantages of these bills and how they can be improved to a better level. The three bills are as follows:

1. The Essential Commodities (Amendment) Bill 2020

A. There are some essential commodities such as salt, oil, potato, onion, rice, wheat, cereals ad many more that are the necessities of living. If any individual makes huge storage then the price will increase because of high demand and less supply. This problem was very common in the time around 1955, so the government came up with a law that if someone is found to store the basic commodities, then the license will be ceased, a heavy penalty will be imposed and one can also be sent to jail.

B. But now, in 2020, the government said that storage of essential commodities is legal except for two conditions: wartime and disaster. It indirectly says that a businessman who has a large area for storage of such items can store the commodities but how much can a common man store in their house? It will be beneficial for the businessmen who have ample space to store the essential commodities but the common man will suffer.

2. Farmers (Empowerment and Protection) Agreement on Price Assurance & Farm Services Bill

A. Mainly, contract farming is placed in this bill. Farmers have a general problem that when they sow the seed, the price of the end product is high but after few months when the end product is ready in their fields, the price gets decreased, and hence the farmers face loss. So, the government said that big companies can do contract farming. For example, Companies like Lays need potatoes for their production, and biscuit companies need wheat for their production. So, these companies can directly make a contract or agreement with the farmers that if you sow this required thing in your fields, we will buy the end product at an already decided price. Hence the farmer is now tension-free because the “Price before Farming” principal is being forced in this type of agreement. During the period of harvesting, the record will be maintained by the company, and depending upon the total production of each farmer, their money will be provided. This bill will give an advantage to the farmers.

B. But still, it needs some improvement, the scope of the settlement must be there, if, by any chance, the company that done the agreement with the farmers shut down permanently before the harvesting season, then who will give money to the farmers? What if a farmer sold their produced crops directly in the market instead of selling them to the company? Because the agreement is only about the price of produced crops or vegetables and their price, it does not include any type of bond between the seller and the buyer.

C. This type of problem can be solved by doing the agreement in the presence of the head of the village instead of doing an agreement one by one with each farmer. This will help the farmers to become less prone to exploitation. Because the head of the village has a little bit of power, so in case, if the company tries to exploit the farmers, then the head of the village should raise the voice because they are more powerful than the normal farmers of that particular village.

D. Contract farming in India is being done since 2012, during the tenure of Mr. Manmohan Singh (former Prime Minister of India). But it was done on a small scale previously. After passing the bill from the parliament, this will be done on a huge scale.

3. Farmers’ Produce Trade and Commerce (Promotion and Facilitation) Bill

A. According to this bill, the farmer who produce crops and sell them in the marketplace. Now the farmers can sell their items where ever they want, selling the crops in the marketplace is not at all mandatory now. NSSO, a government organization claims that only 6% of the produced items are sold in the marketplace, else 94% is sold by the farmer itself. The government claims that by this bill, the mediators between the farmers and the buyers will be removed. When India got independence, the farmers were really very poor, so they used to take a loan from some big businessman in their area and when they did not repay the loan, then the businessman used to take away some of the farmer’s crops. That is why the government came up with a bill APMC (Agriculture Produce Market Committee), but in these committees, the buyers are mediators who purchase the items at a very low cost that causes a small profit to the farmer and a huge amount of profit is earned by the mediators. But now, this bill gives freedom to the farmers to cultivate the crops in their fields and sell them in any corner of the country along with selling to the mediators.

B. The farmers are now worried about the MSP of their crops. MSP stands for Minimum Support Price and it is decided by the Commission for Agriculture Cost and Price (CACP) and works under the Food Corporation of India (FCI). MSP is the price that is finalized by the government before the cultivation of the crops that means this is the minimum price that is to be given to the farmers for their crops harvested during the particular season. Private companies pre-deciding the price is called Contract Farming whereas government pre-deciding the price is called MSP. Now, the farmers are saying that with the help of contract farming, the government is making the private companies decide the price on their own and the government will be away from giving the minimum support price. Although, the government stated that MSP will continue.

C. So, why is there a lot of protests against this thing? Because in the case of MSP, the farmer is tension free but in the case of contract farming, the farmers will be bound by the company to sell the product at the pre-decided price even if the price in the actual market is higher than the decided price in the contract. It will lead to the loss of farmers. So, there exists a risk factor in the case of contract farming, but this risk is not at all present in the MSP.

4. National Food Security Act 2013

A. According to this bill, on every ration card of the below poverty line class, 2rs/kg wheat and 3rs/kg rice will be given. It is because of this bill that the purchasing of crops from farmers on MSP by the government is now almost thirty times more than before and hence it is good for the farmers also.

B. Shanta Kumar Committee, states that purchasing on MSP is an extra burden on the economy of our country so this should be stopped and privatization must be introduced in this field. The statistics say that the government has to face a loss of approximately one thousand crores on MSP, but when the frauds like Vijay Mallya and Nirav Modi happens, then the government pays the banks by the tax that common people have given. So why the Non-Performing Assets (NPA) doesn’t seems like an extra burden to the government? The drawback of the government is that they don’t have the proper space and technology for storage.

It is the harsh reality that from India’s independence to today, none of the government worked for the development of the farmer community. From the time of independence, the earning of farmers have become 21 times but the income of the government officials have increased by 180 times. The income of the government teachers is increased by almost 200 times. This is the reason why farmers do suicide, this is the reason why the farmer community is protesting. If any government is serious about the development of the farmer community then they should introduce a scheme or formula like MRP (Maximum Retail Price). The only difference is that in the case of farmers it should be “Minimum Retail Price” that bounds the minimum price of the grains so that no one can buy the products below that particular price.

Minimum Support Price is only fixing the price but it does not give assurance that the farmer’s crops will be purchased or not. Not only the present government but every government that came into power do the same thing, they just don’t want the farmer community to be developed because if this happens, the basic topic of politics will be demolished. If the Minimum Retail Price policy is fixed by the government, then it doesn’t matter whether you allow them to sell outside the marketplace or not, whether there will be contract farming or not. The GDP of India is saved by the farmers’ community (a total of 3%) but none of the government or political parties want their development.

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