At Last, Farmers get Freedom

The Parliament of India had passed three farm bills namely: The Farmers Produce Trade and Commerce (Promotion and Facilitation) Bill, 2020; The Essential Commodities (Amendment) Bill, 2020; The Farmers (Empowerment and Protection) Agreement on Price Assurance, and Farm Services Bill 2020 during the recent monsoon session. On 27th September 2020, the President of India gave his assent, and it is now the law of the land.

The first is the Farmers’ Produce Trade and Commerce (Promotion and Facilitation) Act, 2020 that aims to provide for the creation of an ecosystem where farmers and traders enjoy the Freedom of choice relating to the sale and purchase of farmers’ produce which facilitates remunerative prices through competitive alternate trading channels. This act is destined to promote efficient, transparent, and barrier-free Inter-State and Intra-State trade and commerce of farmers’ produce outside the physical premises of markets or deemed markets notified under various State agricultural produce market legislation. With its implementation on the ground, no market fee or cess shall be levied on any farmer or trader or electronic trading and transaction platform for trade and commerce in scheduled farmers’ produce in a trade area.

This shall also provide a facilitative framework for electronic trading and matters connected in addition to that or incidental thereto and to address disputes, which might arise in the future between the farmer and retailer or consumer. Leaving aside all the technicalities and perceiving it in a Farmers’ point of view, we get that a farmer from Karnataka produces tomato and sells Dalalr Rs 5 to the mandi, from there the middlemen or dalal sells it for 20 to the retailers and this retailer sells it for 30 to the consumers. Both producer and consumer are at a loss and these middlemen easily make a profit out of it. Also, the farmer is forced to sell it in the mandi of that district only to the price decided and controlled by a few individuals or a small group of people who earn maximum profit. At times there might be a demand for tomatoes in Maharashtra, but the farmer who has excess tomato. Instead, sell it in Maharashtra where there is demand, instead he is forced to sell it in the mandi of his district only, also since, tomato’s life is not more than 1 week, and he cannot sell it in Maharashtra he does panic selling at a price decided by the 2 or 3 individuals at a significantly less price. In that case, any trader, retailer, or merchant can sell their products anywhere in the country at a price fixed by him, but a farmer cannot do the same, isn’t this injustice

Therefore, the legislation is thus brought by the Government to do away this structural and deeply embedded injustice done to the farmers by a small group of profit-making individuals who earn maximum profit from unfair trade of agricultural goods.

The next revolutionary and progressive legislation is The Farmers (Empowerment and Protection) Agreement on Price Assurance and Farm Services Act, 2020, which empowers the farmers for engaging with processors, wholesalers, aggregators, wholesalers, large retailers, exporters, etc., on a level playing field with no fear of exploitation. It envisages contract farming wherein the sponsors bear the whole cost spent for production and allocate a significant price for the crops as mentioned in the contract on the day of procurement or maximum within 3 days of procurement. It, therefore, transfers the danger of market unpredictability and risk from the head of the farmer to the sponsor and also enables the farmer to access modern technology multiplied with better inputs. It will also reduce the cost of selling and underscores enhanced income for farmers. The legislation will act as a catalyst to attract private sector investments for building supply chains for the Indian farm produce directly to national and global markets and other agricultural infrastructure. Farmers will get access to contemporary methods, effective technology, advice for top value agriculture and obtain a ready marketplace for such produce. Farmers will also engage in marketing, thereby eliminating intermediaries leading to the full realisation of price. Farmers are provided with whole protection., Sale, lease, or mortgage of farmers’ land is completely prohibited and farmers’ land is additionally protected against any recovery. An effective dispute resolution mechanism has been provided with clear timelines for redressal.

The act shall also be understood from a Farmer’s point of view – The farmers can also indulge in contract farming. The sponsors will bear the cost of farming by providing the types of equipment needed, fertilisers, etc., and again, they will have a guaranteed price. If a farmer in Bihar who produces potatoes indulges in contract farming, then the sponsors of the contract will have to pay the price for the types of equipment used in for production, for fertilisers, for wages for labours and the sponsor will have to pay the price for the produce to a price not less than the price fixed at APMC or any such institution, by chance, the demand for the product decreases, and the price for the products gets deflated or becomes less, then the farmer from Bihar who has made the contract will get the amount mentioned in the contract, doing away with panic selling. Thus, the legislation directly benefits the farmers.

The third and highly misrepresented legislation by the opposition is The Essential Commodities (Amendment) Act, 2020. This act mentions the supply of certain agricultural products as notified by the Central Government shall be regulated only under extraordinary circumstances which may include war, famine, extraordinary price rise, and natural calamity of grave nature. Any action for imposing a stock limit shall be based on price rise, subject to the conditions, and exemptions specified therein. This means that until there is a crisis or severe price hike a trader may procure ‘n’ number of certain goods as underscored by the Government from time to time in a ‘Gazette Notification’ and can store them for more days, sell it based on the demand resulting in a benefit of both traders and farmers. It is interesting to highlight how governments of non-NDA ruling states are protesting against this act, apprehending the shortage of food as one significant implication of this act, and also creating a misrepresentation of the features of the act benefiting the farmers directly.

Therefore broadcasting the Farmers’ point of view becomes very significant, we see that at times a farmer from Punjab who has produced more wheat might not get the real value for his product in the market as there is no demand, if it is in other fields then the trader or merchant will store the product in a warehouse or ‘godown’ and can sell it when there is demand, but it is practically not possible for the farmer in Punjab because of Essential Commodities Act. So, he rushes to the ‘mandi’ and sells his produce in haste and earns meagre and sometimes sells the product entirely at a loss. Taking cognisance of such impediments and to create a critical support mechanism for the farmers, this act is now multiplied with first-hand benefits for farmers. It becomes effortless for the farmer from Punjab to store the product when there is no demand and sell it later. This will also stabilise the price in the market.

It is evident that these acts are surely going to benefit the farmer, retailers, and the consumers doing away with deep-rooted malpractices of the agricultural trade and market. It is nothing but the opportunistic approach of politics of the umbrella opposition. They are trying to manipulate and instil fear among the farmer community through distorted information and misrepresentation of the legislation. Although the opposition has spread a combination of rumours related to MSP and APMC, it must be noted here that neither MSP will be scrapped nor APMC will be abolished. Also, there are provisions in the legislation to punish if someone cheats the farmers or indulges in malpractices.

It is evident from, repetitive assurances made by the Government of India, the Minister of Agriculture and the Prime Minister himself that the incumbent Government is committed to engineer the growth of the farmers through substantial partnership, open up the market and choices for the farmers and also release the burden of the over-regulated farm market from the head of the farmers.