The double whammy delivered by the Narendra Modi regime with the passage in the Rajya Sabha of the three radical farm Bills, and the tightening of controls over NGOs, especially those plying an anti-national agenda, through the Foreign Contribution (Regulation) Amendment Bill, 2020, reaffirms the government’s political will and determination to muscle through monumental reforms which have eluded the country since independence be they political, social, economic, or fiscal.
The Farmers Produce Trade and Commerce (Promotion and Facilitation) Bill, 2020; The Farmers (Empowerment and Protection) Agreement on Price Assurance and Farm Services Bill, 2020; and The Essential Commodities (Amendment) Bill, 2020, are to the economy what the deactivation of Article 370, the Citizenship Amendment Act (CAA), and outlawing of triple talaq were to the political and social. No right-thinking citizen, in fact, ever doubted the sincerity of the government’s intention behind an extreme measure like demonetization, much less the introduction of the single common Goods and Services Tax (GST) despite the resulting difficulties and tardy implementation.
Striking at the heart of vested interests has been the rationale behind the plethora of reforms ushered by the Modi regime since 2014. The farm Bills are no different. Together they aim at freeing the impoverished small farmers comprising 86 per cent of the community from the stranglehold of their richer brethren, money lenders, and middlemen (aradthia) who have for decades called the shots at the state-run mandis or Agricultural Produce Marketing Committees (APMCs) at arbitrary prices. The new laws give the farmer the freedom to sell to any agency, private or public, anywhere in the country under a system of contract farming. Failing which famers will be free to sell it to the APMCs at the prevailing Minimum Support Price (MSP).
To plug any possibility of exploitation at the hands of corporates, the Price Assurance and Farm Services Bill provides the legal framework and parameters within which farmers can engage with companies and wholesalers that buy in bulk for sale in the retail market. Central to the compact is the transparency of pricing coupled with the precise mechanism for payment, delivery, and dispute settlement through an appellate authority. The Bill puts a premium on quality and standards which under the existing system is exclusively determined by self-serving middlemen. The voice of the small farmer never really mattered.
Luring the farmer into parting with his land is clearly prohibited. There is no way in which it can be acquired. Doing business with privates is generally viewed with suspicion in the farming community used to surviving on government largesse. Competition will now compel the APMCs not to take ordinary farmers for granted. The price his produce will fetch under the new norms will almost certainly be markedly better.
Predictably enough, those protesting the most are vested interests who stand the lose the most. APMCs were created in the mid-1960s as a medium for price discovery and fair transaction quite apart from creating an infrastructure for auctions and storage. The cess they realized from buyers went into defraying their costs. In the early years, the committees effectively channelized the proceeds to create a democratic rural marketing infrastructure with liberal licensing of traders to ensure prompt payment.
Greed set in, gradually. Realization dawned on state governments that the APMC cess was a reliable source of revenue. Since it was outside the purview of the budget, it could be spent at the chief minister’s whim to shower favours on sycophants in the mandi business. The cess in states like Punjab where farmer lobbies are controlled by top politicians inched up to 2.5 per cent. Sukhbir Agro, owned by the president of the Shiromani Akali Dal (SAD) and sitting MP from Ferozepur, Sukhbir Singh Badal, the ex-deputy CM, earned thousands of crores as the aradhtia between farmers and the Food Corporation of India (FCI), the principal procurement arm of the Union government. No farmer could afford to earn the displeasure of Sukhbir Agro given the company’s vice like grip over every aspect of the farming business from procurement, processing, refining, warehousing, distributing and exporting. Ditto is the case with the powerful Pawar clan in Maharashtra whose agricultural income runs into thousands of crores given their control over the chilli, onion, and grape trade.
Small wonder that the APMCs as they stand today serve the Badals and Pawars rather than the small farmers in whose interest they were created. Mandi managements have been systematically reduced to being tools in the hands of coteries of traders and commission agents. Rare is the board with a farmer as member. Cadre officers of the government with little or no interest in the welfare of farmers decide their future. Issuing of new licenses was discouraged or delayed to safeguard the interests of well entrenched traders. Time honored practices like insistence on correct weighment, display of prices in the market yard, transparency during auctions were dispensed with. Result: the near total collapse of price discovery. Reliance on the MSP was never a satisfactory solution.
Reforms by their very nature are aimed at upsetting the existing order of things. Otherwise they would not be reforms of any consequence. Protests are a natural phenomenon. Reforms, however, take time before their effects are felt. With the Modi regime barely 16 months into its second term, the government can afford to let the protests play out. They will die a natural death when the common farmer realizes that the long-term benefits of the new measures.
That the protests, mostly confined to Punjab and Haryana, are a sham is evident from the remarks of the former Himachal Pradesh CM Shanta Kumar. Not more than “six per cent of elite farmers” dancing to the tune of Opposition parties, he said, are behind them. The ex-CM was part of the committee tasked by the PM in 2014 to come up with proposals to reform the farm sector and restructure the FCI. The ground reality is that only six per cent of tillers sell their produce to mandis. The rest by implication are those with small or medium sized land holdings who farm for survival. Such of them who reap a surplus harvest can now sell to buyers outside their local markets at the best available prices. The future of the APMCs is of little consequence to them.
Building trust with small farmers whose survival depends on the vicissitudes of weather was never more necessary than in the time of a raging world pandemic. And there is no better way to invoke trust than direct cash transfers from time to time. Being in touch with their needs is the best safety valve against the barrage of fear-mongering by critics.
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