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Farm Bills 2020: An Overview

The new Agri Reform Bills of The Modi Government are going to bring significant changes to the structure of the agriculture market. The opposition and the farmers are protesting against these new amendments to the Essential Commodities Act. On Sunday, when these bills were passed, Rajya Sabha witnessed a complete breach of rules. The central government did not consider the opposition while voting for the bill ‘killing the very backbone of the parliamentary democracy’. On the other hand the angry politicians of the opposition protested by tearing the rule book, shouting, breaking mics and causing a ruckus in the Upper House of Parliament.

The three bills that were passed are the Farmers’ Produce Trade and Commerce (Promotion and Facilitation) Bill, Farmers (Empowerment and Protection) Agreement on Price Assurance and Farm Services Bill and Essential Commodities (Amendment) Bill. The three pieces of legislation are aimed at:

1) Amending the Essential Commodities Act to deregulate prices and quantity sold of certain commodities deemed essential,

2) Allowing and facilitating contract farming.

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3) Allowing private markets to be set up outside the physical boundaries of the ‘Agriculture Produce Market Committees’ (APMC) mandis. 

The opposition from the farmers is mainly based on the third point. They fear that the bill will eliminate MSP (minimum support price) and benefit the corporates, which in turn would lead to the bigger powers dictating the prices of their crops. An important point in the new legislature is that in the new no market fee, cess or levy shall be charged to the farmer or the trader. Under the old system, these charges could add up to a significant proportion of the transactions – as high as 8.5% in Punjab. Hence, this favours the traders more than the poor farmers.

The opposition protests that this is a “death warrant of the farmers” and hence they will not support it. They have stated that the intention of the government is to end MSP and give all the control to the big capital houses. According to them, it is also against the economic interest of Punjab, which has contributed a lot in making India self-sufficient in food grain production. The ruling party did not consider the opposition’s views on the bill and still the bill got passed which led to them launching a nation-wide protest.

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On the other hand, the government says that the farmers are being manipulated by the opposition. They claim that the bill is to free the farmers from the shackles of the age-long system that only led to their exploitation. They said that the new bills will make it easier for the farmers to sell their produce to the retailers, without having any intermediators in between. The cost of transportation will also be reduced and intra-state trade would be enhanced. According to the ruling party, the bills will bring uniformity into contractual farming rules and provide a framework for trade agreements on farm produce. Farmers cannot be forced to enter into any agreement. They will be free to choose who they want to sell their produce to and a regulatory framework will protect them.

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The COVID-19 brought with it a stagnating phase in the Indian economy. Introducing such drastic changes in the agricultural sector, which is one of the most important sectors in India, does not seem like the most suitable thing to do. The government really needs to keep the fundamentals of democracy in mind, where the opposition is as important as the ruling party. The new bills, for sure, might have long term benefits (which is not confirmed yet). But in a democracy that is ‘of the people, for the people and by the people’, ignoring the public uproar and the pleads of the farmers is just not right. The opposition, too, shall maintain the code of conduct in the House of the Parliament. The main responsibility of our leaders is to create a better India, but mostly, all we get to see is them playing blame games instead of taking ownership.