India is an Agri based economy and the majority of our population depend on the
Agriculture sector for their survival, even after this the reality is something
different that we canít ignore the harsh reality that farmers are the most
marginalized sections of society. There were several attempts made to bring
reforms in this sector from the very time of the green revolution but lack of
execution made these attempts just in paper and words, some attempts such as the
formation of APMC were revolutionary but the issue persists that only a small
sect got benefited which made this wholesome sect in the same girth as it was
before. This article will deal with newly passed farm bills that got the
presidentís assent recently and are expected to be implemented from the
financial year 2021-2022.
One such attempt is made by the current government amid COVID-19 by
bringing three farm bills in parliament namely Farmers' Produce Trade and
Commerce (Promotion and Facilitation) Bill which is aimed to end monopoly
enjoyed by food corporation of India (FCI) and Agricultural produce market
committee (APMC) in existing trading and distribution system, the second one is
the Farmers (Empowerment and Protection) Agreement on Price Assurance and Farm
Services Bill which is aimed at introducing national market and big corporates
in the agricultural sector to create opportunities for farmers by inducing
contract farming, and the Essential Commodities (Amendment) Bill to deregulate
the storage of essentials. And the three bills together brought intending to
boost the farmerís income and a distance goal of doubling the farmer's income by
2022 which will eventually boost the nationís GDP too.
The current system and need of the hour:
First, we need to understand what was the need for such reforms and what kind of
issue persists with the current system. Currently, we have the APMC mandi system
which is a kind of government-authorized mandi where state governments levy
taxes on sell and purchase of goods.
The issue here is that those farmers having large scale production capacity only
those who were able to sell their product in APMC mandis get the benefit of
minimum support price (MSP) and other small scale farmers were either sell their
produces in the general market or have to take the support of middlemen in which
they only get that price which is fixed by middlemen and this circles of
middlemen are that huge that the subsidies provided by the government is
supposed to be distributed between them only and farmers get the very marginal
price of their product.
There is a need to rebuilt the shaken confidence of this sect by ending the
monopoly of mandis and middlemen and inducing a huge capital from the private
sector to give a boost to the Agri economy of our country. These bills will work
as a catalyst in that very motive. Inducement of big private players and the
provisions regarding contract farming will allow the farmers to use technologies
of the modern world and will eventually boost the overall production and a
direct impact on farmer's income.
New farm bills will limit the intervention of the government because they are
bound not to restrict the export when the price of a commodity is in high flux
and this will directly ensure more money in the farmer's pocket. To avoid
cumbersome drafting and legal wording by corporates in the contract this bill
comes up with a model contract so that farmers can easily understand what is
beneficial for them and whatís not.
The second bill addresses the price-fixing mechanism in which there are three
ways by which they can fix the price of their crops they have the option of
fixing price before contract as per their cost of production and including the
fluctuation in the market so that they would no get into the trap of corporates
and they also have the option of fixing price after final cultivation so that
they can sell theirs produces based on the open market price.
Constitutionality of these acts:
Article 13 states (1) All laws in force in the territory of India immediately
before the commencement of this Constitution, in so far as they are inconsistent
with the provisions of this Part, shall, to the extent of such inconsistency, be
void (2) The State shall not make any law which takes away or abridges the
rights conferred by this Part and any law made in contravention of this clause
shall, to the extent of the contravention, be void.
So the very first question arises that are this laws anyhow seeking to abridge
the fundamental rights or is against the basic structure of constitution? There
were petitions filed contending that this laws are against the very basic tenet
of constitution that is federalism as under 7th schedule of
constitution which defines and specifies allocation of powers and functions
between Union & States. It contains three lists; i.e.
- Union List,
- State List and
- Concurrent List.
So as per this agriculture comes under the state list as per entry 14 to
state list along with that there were two more entries i.e. 26 and 27 which
deals with trade, commerce, production and distribution of goods and products
within state boundary whereas entry 33 to concurrent list by the 3rd
constitutional amendment deals with production, trade, commerce and supply. The
point here is this acts are basically dealing with reforms to Agri sect by
introducing or making it as a agriculture industry and doing so these acts are
mainly dealing with trade and commerce.
On subject under concurrent list union and state both hold power while the power
of parliament is superior in that case and there are some points that it is in
controversy with entry 27 to state list but in 1954 by 3rd amendment act along
with introduction of trade and commerce in concurrent list there is slight
change in entry 26 and 27 to state list i.e. all the objects of this list are
subject to provision of entry 33 to the 3rd list. So on a normal interface of
these acts it can be said that they can sustain judicial scrutiny but there are
slight chances to get trapped on entry 14 to state list subject to decision of
honorable supreme court.
Why protest against these bills?
Despite the need for reform what makes the farmers protesting against these
bills. So these reforms are not new to the agrarian sector 18 out of 36
state/union territories have already such reforms or similar to this and if the
contention is that this time it is universally applied to the whole country is
unfounded. But the main contention is missing of MSP in these bills while the
government assuring that MSP will be there but despite rectification in these
bills farmers are demanding complete revocation.
One more contention shown by the farmers is the abolition of the hoarding limit
which can lead to black marketing and price rise as it will enable the exporters
and traders to adjust the demand and price of a particular crop, enabling them
to store large quantities of crops until the price increases and then sell it
which will be of no gain to farmers and will hurt the price of these food crops
making the consumer at loss. The best solution, in that case, is understanding
farmer's concerns and keeping the balance between both sides.
The most important thing which requires attention is MSP, just promising
verbally is not enough, giving on paper should be a must, because this is the
thing for which they were striving and a majority of them were debt-ridden in
the current scenario. Making MSP a legal right and constant throughout the
country will help farmers get the right price of their crop providing them
government purchasing as an option will ensure that they will not be exploited
by big corporate players.
We need to understand that if the country has to come out with solutions to the
persisting issue in our current system of agricultural sect to its grave
economic crisis and to boost the income of its sects, the solution lies neither
in the economies of the urban or in the heavy wording of sitting bureaucrats or
of the extractive economies of the capital. The answer decisively lies in the
resuscitation of the rural economy of country with dignity and respect and
understanding the ground reality by taking the members of that specific sect
into consideration. The country, it must be understood, cannot survive if the
rural falls, and chances of such an event happening today can only be averted
with a considered policy response initiated with empathy and care.
- Constitution of India, ( https://www.india.gov.in/constitution of India)
- The Farmers' Produce Trade and Commerce (Promotion and
Facilitation) Act, 2020
- The Farmers (Empowerment and Protection) Agreement on Price Assurance
and Farm Services Act, 2020
- The Essential Commodities (Amendment) Act, 2020