Agriculture Bills : Issues and Benefits

Issues :

Cooperative Federalism, 

Capitalism,

Regulation,

Myths/Doubts...

Benefits :

Farmers Freedom,

Elimination of Middle-Men,

One Nation, One Market (Integrated Development)...

Recently, Three Bills on agriculture reforms were introduced in the Parliament to replace the ordinances issued during the lockdown.

1. The Farmers' Produce Trade and Commerce (Promotion and Facilitation) Bill, 2020;

2. The Farmers (Empowerment and Protection) Agreement of Price Assurance and Farm Service Bill, 2020 and

3. The Essential Commodities (Amendment) Bill, 2020.

Aim  :

The bills aimed at transforming agriculture in the country and raising farmers' incomes.

1. The Farmers' Produce Trade and Commerce (Promotion and Facilitation) Bill, 2020 :

Main Provisions :

• By new legislation, the farmers and traders will enjoy freedom of choice of sale and purchase of Agri-produce.

• Barrier-free inter-state and intra-state trade and commerce outside the physical premises of markets notified under State Agriculture Produce Marketing legislations.

• The farmers will not be charged any cess or levy for sale of their produce and will not have to bear transport costs.

• The Bill also proposes an electronic trading in transaction platform for ensuring a seamless trade electronically.

• Farmers will be able to engage in direct marketing thereby eliminating intermediaries resulting in full realization of price.

Doubts/Myths :

• Procurement at Minimum Support Price (MSP) will stop.

• Now the mandis (APMC) will end.

• The bill is anti-farmer without any protection to them.

• What will be the future of government electronic trading portal like e-NAM.

Reality :

• Farm bill is not going to affect MSP at all. The MSP system will continue.

• Market system will continue as before.

• The bill will give more options to farmers. Farmers can now sell their crops to anyone, anywhere and can earn more profits by joining with big companies.

• The e-NAM trading system will also continue in mandis.

2. The Farmers (Empowerment and Protection) Agreement of Price Assurance and Farm Service Bill, 2020 :

Main Provisions :

• The new legislation will empower farmers for engaging with processors, wholesalers, aggregators, wholesalers, large retailers, exporters etc., on a level playing field. Price assurance to farmers even before sowing of crops. In case of higher market price, farmers will be entitled to this price over and above the minimum price.

• It will transfer the risk of market unpredictability from the farmer to the sponsor. Due to prior price determination, farmers will be shielded from the rise and fall of market prices.

• It will also enable the farmer to access modern technology, better seed and other inputs.

• It will reduce cost of marketing and improve income of farmers.

• Effective dispute resolution mechanism has been provided for with clear time lines for redressal.

• Impetus to research and new technology in agriculture sector.

Doubts/Myths :

• Big Companies will exploit farmers in the name of Contract.

• Advantage to big corporates, loss to farmers.

• Farmer's land will be in the hands of captalists.

Reality :

• The contract agreement with guarantee the farmers to get the fixed price. Farmers can withdraw from the contract at any point without any penalty.

• In many states, farmers successfully produced crops like sugarcane, cotton, tea, coffee along with large corporates. Now small farmers to benefit from technology and equipment with guaranteed profits.

• The Bill clearly prohibits sale, lease or mortgage of farmers' land. Agreement will be for crops and not for land.

3. The Essential Commodities (Amendment) Bill :

Main Provisions :

• Remove cereals, pulses, oilseeds, edible oils, onion and potatoes from essential commodities. 

• The amendment will deregulate the production, storage, movement and distribution of these food commodities.

• The Central government is allowed regulation of supply during war, famine, extraordinary price rise and natural calamities, while providing exemptions for exporters and processors at such times as well.

• Imposition of any stock limit on agricultural produce must be based on price rise. A stock limit may be imposed only if there is a 100% increase in retail price of horticultural produce; and a 50% increase in the retail price of non-perishable agricultural food items.

Towards Doubling Farmers' Income :

Multi-faced support to Farmers during Financial Year 2019-20 -

• PM Kisan Maan Dhan Yojana launched -

19,19,802 beneficiaries registered.

• PM Kisan Samman Nidhi Yojana launched -

+ Rs. 48,973 Crore released.

+ 8.12 Crore farmer families benefit.

• Hike in MSP of Crops for 2019-20 Season -

+ 50%-85% for Kharif Crops

+ 50%-109% for Rabi Crops

• 421 new mandis approved for integration under the eNAM

Benefits of these Bills :

• Barrier-free inter-state and intra-state trade for Agri-produce.

• These bills promote the creation of Farmers Producer Organisations (FPO) on a large scale.

• It will also aid in creating a farmer- friendly environment for contract farming where small farmers can benefit.

• These bills promote public-private partnership to invest in warehousing, grading and other marketing infrastructure.

• It will develop integrated agriculture market that means a 'One Nation, One Market' for agricultural produce.

• Elimination of middle-men - it will reduce farmers exploitation.

What are the Issues in Agriculture Bills ?

• Issues of Cooperative Federalism :

+ Agriculture and Markets are mentioned in State List (state subjects under entry 14 and 28 respectively).

• According to some experts - the bill can end the assured procurement of food grains at Minimum Support Price (MSP).

• The bills could undermine food security since the State would have no information about the availability of stocks within the State.

• It can increased black marketing of Agri-produce.

• Opposition in the Parliament opposed these bills.

• Farmers and Farmers association across the country protested against the bills.

• Farmers of Punjab, Haryana, UP, Tamil Nadu and other states opposed the bills.

Constitutional Validation of the Bills :

• The trade and commerce in food items is part of the Concurrent List (The Centre have more power).

• Article 249 : Power of Parliament to legislate with respect to a matter in the State list in the national interest.

• Article 248 : Parliament has exclusive power to make any law with respect to any matter not enumerated in Concurrent List and State List.

There are need to develop concansus among the all stakeholders with focus on empowering farmers and decentralisation of agriculture.

References

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AIR

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