Farmer Bills 2020 and its many shades

The Indian parliament passed three agricultural acts - The Farmers (Empowerment and Protection)
Agreement on Price Assurance and Farm Services Bill 2020, The Farming Produce Trade and
Commerce (Promotion and Facilitation) Bill, 2020 and The Essential Commodities (Amendment) Bill,
2020 on September 23, 2020. The following are the few key points from each act that explain the
changes made to the existing agricultural laws:

1) The Farmers (Empowerment and Protection) Agreement on Price Assurance and Farm
Services Bill 2020.
This act allows farmer to get into a legal agreement with a business entity where the farmer
can sell the produce at a pre-determined price before sowing season. The buyer and farmer
mutually agrees on the production amount, quality of produce and delivery time. This whole
process is called contract farming. The produce sold will also be exempted from the state acts
and regulations.

2) The Farming Produce Trade and Commerce (Promotion and Facilitation) Bill, 2020
This act promotes intra-state and inter-state trade of farmers produce i.e. the farmer can sell
their produce outside the Mandis and Agricultural Produce Marketing Committee. It also
prohibits the state government or APMC’s from imposing any taxes or cess.

3) The Essential Commodities (Amendment) Bill, 2020

This bill is an amendment to the existing act in which the central government can add and
remove items in the essential commodities list as per the market situation. The act removed
cereals, pulses, oilseeds, edible oils, onions, and potatoes from the list. Limits on the farm
produce hoarding will be based on the market price and accordingly items will be added to
the essential commodities list.

However, these agricultural reforms have several issues. First of all agriculture comes under state
regulation and the central government has stepped in which does not comes under its domain.
Secondly small farmers which constitute about 86% feels that the laws will make them more
vulnerable as the business corporates might exploit it against them. This has agitated the farmers
which led a strike against the government.

In my opinion following are the constraints in the laws:

a) In case of any legal dispute in contract farming, the farmer will find it very difficult to fight
legally against the corporate giants and also the bill does not specify that the contract price
should be atleast the Minimum Support Price (MSP).
b) The government says that the farmer will now have freedom to sell anywhere but it will
benefit only the big farmers as even to date the small farmers struggle to sell their produce in
Mandi or APMC. There’s also a possiblity of closing of Mandis and APMC (which atleast
guarantees MSP) if eventually more farmers opt out of it. In future corporates might exploit
the farmers on pricing as they have no other source to sell their produce.
c) The government has removed all the foodstuffs from essential commodities list which will
allow companies and traders to store as much they want which indirectly promotes hoarding.
Moreover, the governemnt will only intervene if there is a 50% rise over previous year’s price
in case of non-perishable goods and 100% rise over previous years in perishable goods. This
will leas to increse in the prices of food stuffs and consumers like us will be affected.

Also, the main reason for agitation is the way in which the bill was passed. It was very
undemocratic. The government should have conducted the discussion in the parliament taking in
consensus the opposition and and at least the farmers to avoid the loopholes exisiting in the new
bills. This would have helped the farmers in attaining better practices as well as the government in
privatizing the sector. Sadly, the government wasn’t able to commuincate properly with the
farmers and this led to a mistrust between both the parties.