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Agri Reforms...More of a bane than boon

While large section of media is busy covering bollywood drug racket , Kangana & blah blah blah the AGRI reform bills were passed by Parliament of India without getting the attention that they deserved. Also, Govt of India didn’t care much about taking down the contents and objectives of these bills to its stake holders. Though opposition made its effort to make some noise on this issue in parliament, the Govt ride a rough shot over this in LokSabha and got them passed through voice vote in RajyaSabha.

However, as we step into the details, these reforms are spread across 3 bills and these bills should be read in combination for the better understanding. The first is “Farmers’ Produce Trade and Commerce (Promotion and Facilitation) Bill, 2020 this bill enables the farmers to sell their produce to anyone in any state across the country and also beyond the country. To put it the other way around, this bill allows the private players coming from any state or any country to purchase the produce from the farmers. The second is “Farmers (Empowerment and Protection) Agreement of Price Assurance and Farm Services Bill, 2020”, this bill speaks about the norms applicable for contract farming between the farmers and private players. Basically, it provides the basis on which the private players shall enter into an agreement with farmers prior to cultivation. The third is, “The Essential Commodities (Amendment) Bill” and this bill slashes all the existing stock limit regulations on cereals, pulses, oilseeds, edible oils, onion and potatoes. It permits the private traders to store the aforementioned agriculture commodities which were procured from farmers using the above two bills. Now , after reading the objectives of these 3 bills in brief it is clearly understandable that these bills are 3 in number but all the bills are carrying (more or less)one common objective i.e. opening up the doors of agricultural marketing to private.

Frankly speaking , one should not oppose these bills just because they are allowing the private to take up the agriculture . Iam against that notion that “all private is evil” and “all public is holy”. As long as farmers and consumers are allowed to enjoy their equitable share of benefits in supply chain, one should not worry about whether the marketing is held in hands of private or Govt. Now the whole question is, will these Agri reforms enables that equitable distribution of fruits among all the stake holders ?! Though the intention of the Govt in bringing these bills appears to improve the farmers income conditions and to stabilize the consumers expenditure, we can’t anticipate how these reforms are going to get unfolded on the ground in the coming days.

As far as my rational is concerned , these bills may not turn out to be successful and I also explain why these reforms may fail in achieving their intended purpose,

1) The first bill allows the farmers to sell their produce to private traders. Though APMCs (popularly called as Govt Mandis) will be continued to offer MSP to farmers, once the private enters into the picture those APMCs will loose their significance gradually and once APMCs started loosing their significance, the possibility of private traders forming into a syndicate and dictating the price terms to farmers cannot be ruled out and when farmers finally turn up to Govt Mandis, they may not be in a strong financial position to procure all the produce from the farmers. This will only push farmers into more troubles.

2) The second bill provides a broad basis and guidelines for contract farming and also consists of dispute resolution mechanism. Under the new guidelines, the rate to be paid to farmers by the buyers is fixed prior to cultivation and the same will not be increased proportionately even if the market rate increases by the time of harvest. Also, there is a fear of private buyers not paying the farmers as per agreed terms using the excuses like quality or size or taste etc and we all know that farmer is no where equal to giant corporate in fighting the disputes before dispute resolution bodies.

3) The third and the last bill is about lifting all the stock limit regulations for cereals, pulses, oilseeds, edible oils, onions and potatoes. Surprisingly ,After allowing the private traders to stock as much as they wish, The Govt is not concerned about tracking the stock quantities with these private traders (who is stocking how much of quantity of what commodity and in which locations it is stocked).Given that the absence of track with the Govt, It is more certain that these private traders will procure from farmers at lower rates and pile up the stock to swing the market conditions the way they wanted and sell these commodities at abnormally higher rates to retailers. This time the consumer is made a scapegoat.

In my best opinion , these bills would have been sent to the select committees and concerned standing committees of the Parliament for a detailed discussion and debate about the merits and de-merits , which also would have enabled the Govt to take their intentions and objectives to all its stake holders particularly to the State Governments and the Farmers organizations.

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This content reflects the personal opinions of the author. It is accurate and true to the best of the author’s knowledge and should not be substituted for impartial fact or advice in legal, political, or personal matters.

© 2020 Gowtham Gaddam


Chandana Chemuduru on September 26, 2020:

Well elucidated...

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