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Saturday, October 1, 2022

Bharat’s richer farmers are holding up reforms designed to help the poor: Australian academic

Many Bharatiya agricultural experts and academics have maintained that the 3 farm reforms introduced by the Modi government last year are the result of years of brainstorming and much-needed measures to improve farmer incomes, gavlanize cold-chain and other infrastructure development, and encourage more eco-friendly farming practises.

HinduPost has covered what experts like renowned agricultural economist Ashok Gulati and others had to say about these reforms. Now, a foreign academic from Australia, Salvatore Babones, has penned an important article for Foreign Policy magazine which reiterates how the ongoing farmer protests are status quoist in nature and, contrary to the picture painted in Western media, anti-poor.

Although we must add that the article misses pointing out that the protests started from Punjab where they were in part also driven by a sense of Jat Sikh supremacism, before spilling over to Delhi’s borders. Initially, Jats of Haryana, including Rakesh Tikait, welcomed the reforms before some leaders changed their tune a few months later after sensing a political opportunity in joining the protests. The hijacking of the protests by pro-Khalistani forces has also been skipped in the article.

We reproduce some excerpts from Babones’ article below (emphasis added):

“In 2018, tens of thousands of poor farmers flooded cities all across India calling for government action to ease their difficult lives. Their immediate demands were higher prices for their output and loan waivers for their debts….Modi offered the farmers limited price supports but held the line on loan waivers. Instead, he promised to implement structural reforms after the election. The opposition Indian National Congress countered with a promise to “waive all farm loans” across the entire country—an expensive solution decried by economists as a populist magic wand.

When the test came, Modi’s BJP won in a landslide. One year later, the Modi government finally responded to farmers’ concerns with structural reforms intended to permanently raise agricultural incomes by giving farmers access to better prices from wider markets beyond their home districts—that is, with the 2020 farm acts.

Though opinion polls document broad popular support for Modi’s farm reforms, they have drawn some of India’s richest farmers onto the streets of Delhi and into the world’s media spotlight. That’s right: India’s better-off farmers, or at least farmers from those parts of India with the largest farms and the highest farm incomes.

Despite what activists and Western celebrities supporting the protests would have us believe, most of those who’ve been protesting the new laws since September aren’t drawn from the ranks of marginalized subsistence farmers driven by debt and despair to the edge of suicide. They represent instead the politically powerful (and heavily subsidized) remnants of India’s traditional landlord caste.

These farmers fear that the laws will help large agribusinesses undermine the current state-directed system for buying farm produce and ultimately lead to the dismantling of the price support system on which they depend. They are demanding that the government repeal the reforms and guarantee the future of price supports.

Modi’s reforms aim to transform Indian agriculture from a locally managed rural economy into a modern national industry.

At the center of the controversy are Modi’s three new farm laws. The first allows farmers to sell their produce outside their local area if they think they can get a better price than that offered by their local government-run markets. The second (and most controversial) allows farmers to engage in contract farming by selling their produce in advance—a widespread practice in the West but sensitive in India because of the potential for abuse. The third allows private distributors to set up large-scale warehouse operations without fear of being prosecuted for hoarding food.

…They will allow small farmers to specialize in niche crops that can be marketed nationwide through large-scale wholesalers….Neither the risks nor the rewards will immediately affect the livelihoods of the protesting farmers. Their subsidies and support structures will remain in place, at least for now. But the reforms will upset rural hierarchies and undermine traditional ways of life….

Delhi’s farm protesters mainly hail from the Jat community….Jats are mainly concentrated in Haryana (where they are predominantly Hindu) and Punjab (where they are predominantly Sikh)…Jats make up a relatively small proportion of India’s total population, but their concentration in Haryana and Punjab, and their association with the land, makes them locally powerful in these two states.

It has been estimated that Jats own roughly three-fourths or four-fifths of all agricultural land in Haryana and eastern Punjab, respectively. Nearly all medium- and large-scale farmers in both states are reputed to belong to the Jat community. The farm protesters’ claim to have mobilized 200,000 tractors for their Republic Day rally on Jan. 26 confirms the prevalence of relatively large-scale farmers among the protesters, given that few Indian farmers own enough land to practice mechanized agriculture. Even today, the typical Indian farmer is still 10 times more likely to own a bullock than a tractor.

Farm incomes in Punjab and Haryana are the highest in India, with the average farmer in these states earning more than twice the national average and nearly three times as much as their neighbors in nearby Uttar Pradesh. They also garner the lion’s share of government support. More than 90 percent of their cropland is covered by heavily subsidized irrigation. And the government buys almost the entire output of Punjab and Haryana farmers at minimum support prices that are set far above market levels. The results are huge and growing official stockpiles of wheat and rice, much of which ends up being given away to the country’s poor—or simply rotting in place.

The Jat farmers of Punjab and Haryana have long lobbied India’s government to maintain an agricultural system that is both economically wasteful and environmentally destructive. And why shouldn’t they? India is a democracy, and in a democracy, the squeaky wheel gets the grease—and the subsidies. The fact that India’s richest farmers are vocally demonstrating for policies that secure their livelihoods should come as no surprise. And the fact that they have convinced international celebrities and activists like Rihanna, Greta Thunberg, and Meena Harris to take up their cause is perhaps a bit odd but nonetheless impressive.

But when authoritative Western media outlets uncritically buy in to the “poor farmers” narrative, the result is pure misinformation. Articles suggesting that the BJP’s new farm laws threaten the livelihoods of as many as 800 million people must wrestle with the reality that in a country where 52 percent of the working population is engaged in agriculture, only 6 percent of the population actively disapprove of Modi’s performance in office. On the theory that most people—and especially poor people—are keenly aware of how government policies affect their pocketbooks, the default assumption must be that most Indian farmers believe that the new laws will actually help them, not hurt them.

..India’s poorest farmers need the reforms because most of them do not have access to the high levels of government subsidies that benefit the larger-scale Jat farmers of Haryana and Punjab. Forced to sell to local middlemen at spot prices, they lack options for marketing their produce outside their home districts. They also lack access to financing and futures markets, management tools that most Western farmers take for granted. The new laws are designed to address these problems while maintaining minimum support prices for the relatively small number of farmers who actually receive them.

…it’s not the threat to their livelihoods that has brought the Jats out into the streets. It’s the threat to their political power. The BJP’s farm reforms will empower smaller, poorer, lower-caste groups by giving them new outlets for their produce that circumvent long-established channels…..Their natural inclination is to try to stop the clock of liberalization—and if possible to turn it back. A better solution would be for them to find a way out of the cycle of dependence in which they are now trapped.

The traditional Jat landholders of Haryana and Punjab may be well-off by the standards of rural India, but they find themselves increasingly marginalized in India’s rapidly modernizing society…

In a vain effort to assuage the protesters’ fears, Modi has offered to put the reforms on hold for 18 months. That won’t help anyone—least of all the protesting Jats. A better solution would be to incorporate into the reforms a transition plan that offers the better-off farmers of Haryana and Punjab a route forward into the 21st-century market economy. These farmers lead the country in mechanization and employ millions of migrant laborers from neighboring states. They have the modern managerial know-how that Indian agriculture needs to succeed. They should be leading reforms, not protesting them.

We hope that our Jat brothers and sisters realize they are being misled by a few leaders with dubious agendas, and come forward to embrace reforms which will only make Bharat stronger.

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