Farm Bill

As we all know, Farmers are the backbone of Indian agriculture and the economy. They work so hard throughout the year to get the best returns on their produce. On the contrary, the Government has passed three new Farm Bill in the upper house and as well as in the Lower house by the majority which has given rise to multiple farmers’ protests across the country.

Under these Bills, Framers will now have freedom for direct marketing and dealing of their crops that will give better prices in return. The Minimum Support Price (MSP) criteria shall prevail as before  and consumers will also get benefit as said by Union Minister of Agriculture and Farmers Welfare.

The Government officials also state that these bills will accelerate agricultural growth through private sector investment in building agricultural infrastructure and supply chains for Indian farm produce in national and international markets and also increase employment opportunities and strengthen the economy at large.

In this Article, we will learn about every aspect of these bills that has caused a menace in the society and agitation amongst the farmers in different parts of India.

Bills that are opposed by the farmers and political parties and on what grounds?

  • The Farmer’s Produce Trade and Commerce (Promotion and Facilitation) Bill, 2020
    • This bill deals with the agricultural markets and aims to create a balanced ecosystem where farmers and traders enjoy the freedom to sell and buy farm produce beyond the registered ‘sabzi mandis’ and Agricultural Produce and Livestock Market Committee (APMC).
    • This bill also promotes barrier-free inter-state and intra-state trade of farmer’s produce.
    • It also aims to reduce marketing and transporting costs involved and help farmers in providing better prices of their produce.
    • This bill will also give rise to electronic trading with the proper framework.
  • One India, One Agricultural Market
    • The agenda behind this bill is to create additional trading opportunities for the ‘Mandis’ and ‘Market Committees’ to help the farmers in getting best monetary benefits in the competitive market. This will enhance the existing Minimum Support Price system that is providing stable income to farmers.
    • This will certainly build the way for creating One India and One Agricultural Market and will lay the foundation for ensuring golden harvests for our hard working farmers.
  • Criticism
    • The experts affirm that States will lose revenue as they won’t be able to collect ‘mandi fees’ if farmers sell their produce outside the described markets.
    • The question here arises of what will happen to the ‘commission agents’ in the States if the entire farm trade shifts out of mandis?
    • This bill might eventually end the Minimum Support Price based system.
    • The electronic trading like e-NAM that uses physical mandi structure might be destroyed.
  • The Farmer (Empowerment and Protection) Agreement of Price Assurance and Farm Services Bill, 2020
    • This bill deals with contract farming where Farmers can enter into a contract with agricultural business firms, processing units, wholesalers, exporters or large retailers for sale of future farming produce at a pre- agreed price.
    • This bill will focus on marginal and small farmers those who have land less than five hectares shall gain through aggregation and contract(the study says that Marginal and Small farmers account for 86% of total farmers in India).
    •  This bill transfers the risk of market unpredictability from farmers to sponsors.
    • This will enable farmers to access modern technology and get better inputs in return.
    • This bill aims to reduce the cost of marketing and boost farmer’s income.
    • Now farmers can engage in direct marketing by eliminating middlemen for full price realisation.
    • This bill will frame a dispute resolution mechanism with redressal timelines. 
  • Criticisms
    • Many people think that farmers in contract farming arrangements will become weaker in terms of their ability to negotiate what they need.
    • In this bill, sponsors may not like to deal with a class of small and marginal farmers.
    • Big private companies, exporters, wholesalers and processors will have the hand in dispute.
  • The Essential Commodities( Amendment) Bill, 2020
    • This bill is relating to the removal of some commodities like cereals, pulses, oilseeds, onion, and potatoes from the list of essential commodities. It will emphasize on stock holding limits on such items under unforeseeable circumstances such as war.
    • This amendment will attract the private sector and FDI into the farm sector as it will remove the fear of private investors of excessive regulatory interference in the smooth functioning of the business.
    • The amendment will bring investment for farm infrastructure like warehouses, cold storages, and modernizing the food supply chain.
    • This will help to maintain the price stability for farmers and consumers both.
    • The bill is to create a competitive and healthy market environment and cut wastage of farm produce.
  • Criticisms
    • Many people say that price limits for “extraordinary circumstances’ are so high that they are likely to never be settled.

Who all are protesting on New Farm Bill ?

  • There are several communities and political parties who are against these bills and begin to protest in their own ways.
  • Political Parties like Congress and BJP ally Shiromani Akali dal have raised their voices to stop the passing of these bills and also its minister Harsimrat Kaur Badal has resigned from the designation regarding the bills.
  • Farmers unions like Bhartiya Kisan Union, All India Kisan Sangharsh Coordination Committee and Maharashtra based Shetkari Sanghatana and several others are in the list that have been protesting against the bills which they believe are designed to help big corporate houses in the name of farmers.

Why are the Protests taking place?

  • Earlier, the old system might not fall in the favour of farmers who could stand and raise their voice for more choices as the new legislation asserts.
  • The new legislation is likely to impact influential commission agents (Arhatiya) in areas of Punjab and Haryana in Mandis who used to have a strong impact on the farmers’ strength.
  • The State Governments of Punjab and Haryana will be most affected because of the Mandi Tax which was considered as a good source of revenue.
  • The experts also say that the Arhatiya will be impacted by the commission and traditional business practices will also be harmed.
  • The relationship between the Arhatiya and Framer is deemed to be very close and act as informal bankers without collateral in the times of need. 
  • The Government officials have already told that the passed legislation did not do away with the system altogether and have added multiple options for the farmers to conduct their business. The fear of the Minimum Support Price system deterioration is completely vague and pointless, they said.
  • The Concept of Minimum Support Price (MSP) has taken a new rage in these bills.
  • The protesters claim that the Minimum Support Price (MSP) regime would end in due course and irrelevance and state-controlled Agricultural Produce Market Committee (APMC) mandis.
  • There is also a risk of losing out land rights under contract farming provisions.
  • The reduction in the price of farm produce due to market domination by big agricultural producers and exploitation of farmers by big contractors through contract farming provision will be a challenge under the new bill, the protesters said.