In 2020, we have witnessed many changes in our lives because of the current pandemic going on. While our life is on pause, the government has introduced many changes in many sectors. The Environment Impact Assessment draft, the National Education Policy, and now the Farms Bill, 2020. The EIA draft received many criticisms but that was not the case for National Education policy, but again the Farm Bill has led to several protests across the country and especially in the states like Punjab, Haryana where the majority of the population is in the agricultural industry. Farmers have called for protests against this Bill. The opposition parties have been deeply criticizing this bill. Some even called it a sell-out to the corporate sector’s interests. Protests and criticism is a normal thing in any democracy, that puts light on what is wrong with a particular bill or draft and thus, makes room for improvement. As we move further, we will look into what is the farm’s bill, why the farmers are opposing it, and the government’s idea behind this bill.
Table of Contents
WHAT IS FARMS BILL 2020?
This bill is a combination of three separate bills namely:
- Farmer’s Produce Trade and Commerce (Promotion and facilitation) Bill,
- Farmers (Empowerment and Protection) Agreement on Price Assurance and farms services Bill,
- Essential Commodities (Amendment) Bill.
Let’s see what these three bills offer:
FARMER’S PRODUCE TRADE AND COMMERCE (PROMOTION AND FACILITATION) BILL
This bill is basically a bill on agricultural markets. It tries to make the agricultural market more flexible. It gives both farmers and traders freedom to buy and sell agricultural produce outside the “mandi system” understates APMC (Agriculture market production committee) and to promote a centralized system with no or minimum interstate barriers while also reducing transportation costs.
FARMERS (EMPOWERMENT AND PROTECTION) AGREEMENT ON PRICE ASSURANCE AND FARMS SERVICES BILL
This bill will enable the farmers to enter into a contract with agricultural business firms, processors, and industries in the sector for selling their future production at a pre-agreed price. The aim is to reduce the cost of production which will eventually help the farmers to get better prices.
ESSENTIAL COMMODITIES (AMENDMENT) BILL
This bill seeks to remove produce like pulses, cereals, oilseeds, onions, etc., from the list of essential commodities. The imposition of stock holding limits will go away except under “extraordinary circumstances”. The bill aims to bring in more private sector investments and FDI (Foreign Direct Investment) in the agricultural sector and aims to bring price stability in the agricultural sector.
The government introduced these three bills combined in farm bill 2020. The government intends to bring in corporate investments in the agricultural sector which will benefit the farmers and the corporate industry to flourish and farmers will get better revenue for their produce. On the other hand, there are wide protests and the farmer’s demands otherwise. They are against the ideas proposed by the government for them. The structural change in the agricultural sector that the government is trying to bring in through these bills are not welcomed by the farmers
GOVERNMENT’S RATIONALE BEHIND THE BILL
Now that we have looked into the details of the bill, it is important to know the rationale behind the introduction of such reforms in the agricultural sector. Amidst all the protests and criticisms, the government came up with the clarifications of the opposition and the farmers. The government is of the view that these bills will for sure transform the agricultural sector and empower farmers in a way that will free the farmers from the hindrances and will liberate them from being prey to the middlemen. It will double up the income of the farmers and remove their adversities and help them cope up with the technically advanced globalised market. The agricultural sector needs technological advancement to achieve greater prosperity. The idea behind these potential reformative bills is to ensure that the farmers get remunerative prices for their products and improve their income and thus, increase their living standards. Farmers will be well protected from the adversities while they will have a better stand in the market. The bill aims to bring in more investments and have provisions for the potential threats from such investment. The farmers will be profited and protected from losses due to the external factors. The farm’s bills have touched various aspects of the agricultural sectors from ensuring greater MSPs to provisions related to contract farming. Despite all the provisions, if there is a problem then the government has ensured that there will be an effective dispute resolution mechanism with fast redressals. With this bill, the government seeks to achieve market stability in this sector. Digitalization is being introduced in the farming sector which will protect farmers from cybercrimes and will ensure transparency in the system.
We have looked into the government’s point of view and intention behind the farm bill, now let’s have a look into what the opposition feels about this bill. Before passing any bill, it is important to take into consideration the views of the opposition’s views because that is an important part of a democratic rule. It is a way of checks and balances on the laws formulated therein. The opposition has heavily criticised this bill by pointing out crucial loopholes in the provisions of the bill. One of the main criticisms which this bill received was regarding the replacement of APMCs with a centralised system. They are of the view that the objective with which APMCs were made has been dismantled by this bill. The rationale was to provide fair trade between buyers and sellers and regulate the trade market but if the market for the farmers will be centralised then it can be seen as an indicator of the end of assured MSPs ( Minimum Support Price) for the farmers. They argue that instead of centralisation, the government should ensure larger MSPs to the farmers through the existing system. Another criticism that this bill received was regarding the framework of contract farming. Though the provisions are good there is no mechanism that determines the price fixation. Since contract farming is new to the farmers and the majority of the farmers are not well educated to completely understand and frame an agreement, this can give the corporate sector an upper hand and can lead to the exploitation of farmers. Another major criticism was related to the removal of certain commodities from the essential commodities list. The opposition and critics are of the view that it may dismantle the entire chain of production, storage, movement. Such deregulation in these things will have a negative impact. Also, the opposition argues that there is a loophole in terms of food security. Since the state will not have any information about produce within the state due to centralisation, there will be a threat to food security. Farmers will be exploited in the transaction. They are of the view that some of the provisions may lead to an increase in black marketing and will invite unpredictability in market prices. The opposition-held many protests along with farmers for withdrawal of the bill.
Farmers are the ones who will be affected by this bill. India is popularly known as a country of villages and most of its population is engaged in the agricultural sector. In India, we have the majority of the farmer’s population in the marginal and small scale category. With the government’s incentive to bring in structural reforms, the farmers perceive it as a threat to the existing system and anticipate losses. They are not happy with the provisions. They have held many protests especially farmers in Punjab, Haryana where more than 80% population is dependent on the agricultural sector for their livelihood. Farmers are mainly worried about the end of wholesale markets and assured MSPs. They are concerned about not having any backup option in case things don’t go well or they are not satisfied with the prices offered by the private buyers. They anticipate exploitation in the coming years if not now. They fear that these private buyers will first attract the farmers with some attractive prices and will exploit them when the mandis will be fully wrapped up. They have been putting up their opinion through media and protests. The opposition is supporting their protests and has been taking their opinion and anticipation to the ruling government.
PASSING OF BILL IN PARLIAMENT AND APPROVAL OF THE PRESIDENT
The farm bill 2020 has been successfully passed by both the houses of parliament and has received the assent of the President. The said bill was introduced in the Lok Sabha on 14th September 2020 and was passed by Lok Sabha on 17th September 2020. It was then passed on to Rajya sabha where it got approved on 20th September 2020. The president gave his assent on 27th September 2020 and thus, this bill became enforceable.
We looked upon various aspects of the bill, the doubts of the opposition, and the farmers were put forward and the government gave clarifications for most of the doubts. However, if one looks upon the time frame within which it was passed, one would notice that it was too short for a proper discussion on the bill which will affect such a large sector and population. Within less than 15 days the bill was introduced and received the assent of the President. There should be a proper room for discussion so that no one will be left with any doubts or at least the people concerned.
- President’s Assent on Farm’s bill, 27 September, 2020, available at: https://www.livemint.com/news/india/president-kovind-gives-his-assent-for-three-farm-bills-passed-by-parliament-11601210482225.html ( Last visited on 5th October, 2020).
- Editorial, ” Farm bills: Are India’s new reforms a ‘death warrant’ for farmers?”, BBC News, 23rd September 2020, available at https://www.bbc.com/news/world-asia-india-54233080 (Last visited on 5th October, 2020).
- What is farms bill, available at:https://blog.finology.in/recent-updates/farm-bill-2020-pros-and-cons ( Last visited on 6th October 2020).
BY TRIPTI KHIRWAL | GD GOENKA UNIVERSITY