Farm laws arm-twist farmers : Vanam Jwala Narasimha Rao

 Farm laws arm-twist farmers

Vanam Jwala Narasimha Rao

The Pioneer (01-10-2020)

Until four-five decades ago, when every village in our country functioned as a Republic in itself, agriculture was not considered as a mere profitable vocation. It was then more a profession, a passion and a serving mechanism. With majority of the population dependent directly or indirectly on agriculture, the entire village economy flourished and thrived on a convenient barter system.

Each village produced the agricultural commodities mainly for its needs and nobody gave a thought for any surplus production. Every farmer, big and small, had some sort of a storage mechanism that included storage of seeds for the next year. There was no concept of buying seeds.

Gradually with the advent of market-based economy, agriculture produce started moving out of the villages, to the nearby markets. This expansion of geographical area added to the problems of farmers and middlemen, traders and agents entered the system. This gave rise to commercialization and the producer of an agriculture product became dependent on outside market even for his needs. Not only agriculture products but also milk products, vegetables etc. which were hitherto were available in village itself have over a period became salable commodity elsewhere.  

Since Independence, despite policies and programs being launched by successive governments to make the country self-sufficient in essential commodities, in effect, not much was done to make agriculture profitable. On the contrary, due to several loopholes and lacunae in agriculture policies, farmers were often pushed into debts driving them to commit suicides. Most of these deaths were due to non-availability of money for the farmers for investment in agriculture operations from sowing seeds to selling the produce in markets for a good support price.

For the first time in the country, innovative schemes were designed, developed and delivered for the farming sector in Telangana after K Chandrashekhar Rao became Chief Minister. Notable among them was the Rythu Bandhu or the investment support scheme for agriculture that involved payment of Rs 10000 per acre in two instalments. Likewise, the Rythu Bhima, a life insurance scheme for farmers, gave tremendous confidence to farmer. Many schemes benefiting farmers preceded and succeeded these schemes in Telangana. 

Another innovative and practical model that CM KCR successfully implemented despite the massive Corona Pandemic was to set up purchasing centers at the village level to purchase the paddy and other agriculture produce, irrespective of its quality at best of the price acceptable to farmer. This helped the farmers to sell their produce without running hither and thither. PM Modi should have given a thought to this innovative Telangana State Model and replicated at the national level. Instead, came, the Amendment to Farm Acts in such a way that it would do harm to farmers and consumers in many ways.

This being so, the Union Government has preferred to bring three controversial and draconian laws that gave a free hand to Corporates to ride roughshod over the farm sector and making farmers a helpless victim of the Corporates and their whims and fancies for generations to come. For instance, the new Essential Commodities Act removes food items such as pulses, potato, cereals, onions, edible oilseeds and oils, from the list of essential commodities. Under the new Act, the government cannot impose a stock limit. In other words, the government cannot stop a vicious supermarket chain, retailer chain, or any corporate entity or another individual or group of individuals from hoarding essential commodities.

In states the Agriculture Produce Market Committee (APMC) sets up markets or Mandi or Market Yards in the state, where the farmers bring their produce, and wholesale and retail traders come to buy the produce through auction. The APMCs across the country ensure that farmers get a fair price for their produce, and aren’t forced to make a distress sale. Plus, the idea is to get rid of middlemen. The buyers and commission agents are regulated by the APMCs by providing them licensees, levying market fees and any such charges were always regulated. This has been the practice normally.

The new Act says that farmers can sell their produce ‘anywhere’.  What does this ‘anywhere’ mean nobody knows!!! They Act stipulates that farmer need not sell in the APMC approved marketplace. That is, they can sell within the state, outside the state or even online! How many farmers are capable of selling online, god alone knows!!! But the important point is that Agriculture Marketing is a state subject. And hence, the Centre had no business to make such laws in the first place.

Presently the APMC markets ensure that farmers get the Minimum Support Price for their produce. Farmers, activists and experts are worried that if the trade is done outside the APMC marketplace, they may not get any MSP, as the new law does not mention MSP. The new law does not say that the trade will have to be above MSP. This may lead to distress sale by farmers.

Another Bill says that farmers can enter into ‘written agreements’ with anyone, including a company, and sell them their produce for a set period of time, as per the contract. This implies that companies will have an upper hand in setting the price for the produce establishing standard and evaluating quality.

About 82% of farmers in the country (More in Telangana) are small or marginal farmers. Can they assert their rights while seeking the implementation of the contract on a level playing field? What happens if the buyer says the quality of crop is not what was agreed and does not implement the contract? What security, guarantee and protection the farmer has under the new farm laws?

The free hand given to private corporate houses will lead to exploitation of farmers. With corporate entities fixing the price to their advantage while entering into written contracts, the farmers will have no option but to sign on the dotted line. In any case with such Law in force, the farmers would be at the mercy of the Corporates. Corporates entities may also resort to extending loans to farmers for investment, which could be on high interest rates, for buying their product after harvest.

Corporate companies can now have contracts with farmers to buy their produce, but farmers do not have the protection of (MSP) Minimum Support Price. Retail chains can contract a whole bunch of farmers and hoard produce, thereafter artificially increasing prices for profit. And both the farmers and consumers have no option but to be at the receiving end.

The new laws are not as progressive as claimed by the center. They are retrograde in nature and they would destroy the problem ridden Agriculture Sector in the country.

with VJM Divakar