Farms Act & Dissension

The first Act “The Farmers’ Produce Trade and Commerce (Promotion and Facilitation) Act :- talks about electronic trading and platform, it stated that there will be setup to facilitate direct and online buying and selling of farmer’s produce through electronic device network , further absence of Minimum Support Price (MSP)clause has left all farmers doubtful. If the concept of MSP still there the same should have been mentioned in the Act and not be kept hidden behind the veils. Farmers and traders have been allowed to sell buy and sell outside the state agricultural produce market committee. This will remove the revenue which the state generate and in return the state provide farmers with subsidies. 

The farmers get Rs 13,275 crore (approx.) of electricity and 9 fertiliser subsidy, the FCI system adds a considerable amount to this as well. FCI had around 42 million tonnes of extra wheat and rice stocks in June 2020, and since it costs a lot of money to carry this stock – given the high price of purchase, liquidating it is difficult – this is an implicit subsidy to the farmer. Punjab’s farmers get an additional Rs 5,600 crore (approx.) of subsidy. Add this to the fertilizer and electricity subsidy and you get an annual subsidy of Rs 18,875 crore(approx.) ;divide this by the 1.09 million farming households the state has and, it turns out, each household gets an annual subsidy of Rs 173,165.

According to FCI data, the economic cost of wheat is Rs 2,505 per quintal(approx.) and Rs 3,601 for rice(approx.). From this, reduce the cost of purchase – Rs 2,221for wheat and Rs 3,163 for rice The FCI PROCURE 26% from Punjab. It is also to be noted that Punjab accounts for 13% of the country’s rice and wheat crop. This could be the obvious reasons why Punjab grows so much wheat and rice, is linked to this FCI kindness towards this state and the concern of farmer now.

Also the Farmers were concern about the new set of market or what can alternatively be said as APMC mandis having no restrictions, where in case the government is allowing, these new markets to come up; the state and local government should be given power to oversee their functioning and also regulate them. On the other hand where the dispute redressal system thousands of matters are already pending in SDMs’ offices, the addition of these matters of conciliation to resolve dispute between a farmer and buyer/ trader, has also become another concern, the long

wait for their dispute to resolve will also act as hindrance. For example, where trader purchases farmer’s produce and leaves the state with a promise to pay within 3 days and never return? Which door will the farmer knock?

The second act ‘The Farmers (Empowerment and Protection) Agreement on Price Assurance and Farm Services Act, 2020 

This act focus on Connecting the farmer directly with the companies, processing   units     wholesaler controllers and organized retailers and to  facilitate the agreement with the traders by price of agricultural products in advance. Giving benefit of group and contract farming to marginal and small farmers with less than 5 hectares of land 85 percent of the country’s farmers have less than 5 hectares of land.  Now the farmers fear that Farmers’ favour will be weak in contractual farming agreement The sponsor may avoid the large number of small seed farmers, Big company, exporter wholesalers and processing units would like to take advantage of any type of dispute. If we talk about the section particularly,

  • Section 2(e) does not identify labour/tiller/share cropper working
  • Section 4- the party may over-look the environmental factor. Over using of land will gradually lead it to barren and infertility leaving farmers without any source of income.
  • Section 13 –The dispute settlement system is not clear with the process and mechanism though conciliation method has been sought as an option to settle any dispute. Where the conciliation board has not be decided prior by the farmer and the trader the SDM’s court can constitute the same, and the same dispute has to be settled within 30 days period. The farmer are also protected by this act if their crops as required by the agreement are damaged because of force majure.
  • Section 14- Talks about the dispute if not solved by way of conciliation may be taken by the parties to SDM who shall decide the dispute. But there could have been a separate court as there is a lot of burden already any indefinite time will be consumed a very good example can be like Labour Courts present for workmen.
  • Section 18 further protects and arbitrary decision taken by the SDM in case of conflict of interest.

The third act Essential Commodities Act (Amendment) Act :-

It empowers the Central government to regulate food items only in extraordinary circumstances or impose stock limits if there is a steep price rise. However, the points of contention are:

  • Restriction on hoarding of products does not exist now. On contrary the government is now removing all the foodstuffs from this category allowing companies and traders to store as much quantity of food as they want which amounts to promoting hoarding.
  • Through this Amendment the government is giving up its power to prevent hoarding and controlling price inflation. According to the law, government can intervene only if there is 50% increase in retail price and 100% retail price rise over horticulture goods over the price prevailing immediately preceding twelve months, or average retail price of last five years, whichever is lower.
  • The removal of essential items will subject to possible rise in price of even essential items which can even go out of the pocket of middle man in some cases where there is insufficient in-flow of income parallel to rise in price of commodities.
  • Hoarding can also effect farmers, if companies hoards enough for their supply and in order to manipulate farmer to sell their produce at cheap rate by refusing to purchase, farmer will have no choice but the price at which the buyer wants.

But the question after all this discussion is why farmers did chose to march towards Delhi? Why did not they tried to resolve it by talking to their respective state leaders?  To discuss the above question we need to put light on 2 (Two) bills which were proposed in lok sabha in year 2018 ‘The Farmers’ Freedom from Indebtedness Bill 2018′, and the second was ‘The Farmers’ Right to Guaranteed Remunerative Minimum Support Price (MSP) for Agricultural Commodities Bill 2018’. These Bills were drafted by the members of the All India Kisan Sangharsh Coordination Committee (AIKSCC) which are not taken into consideration gradually the concept of having Minimum Support Price (MSP)in codified form vanished with it. 

Even after discussing some issue with these acts it per-se appears to be appealing as it will welcomes development of farmers. But the agitation of farmer are for complete abolition of these acts, and further fine of Rs One crore or a jail for a term of 5 years for Stubble burning  in Punjab Haryana, Uttar Pradesh and Delhi NCR are another concerns. Now In a short term these acts can go with the ideas/plans of the government, but the pocket of middle man will hit bad if the price inflation of the commodities. The solution to this can only be determined by mutual conversation intending to resolve the issue which are detrimental in any condition for farmers.