Before we dig deeper into the specifity of the three farm bills and why farmers are protesting them, let us be very cautious before sharing any content on our electronic platforms.
Without any shadow of doubt many anti-BJP parties are trying to hijack the farmers agitation, be it fake images and news being published on the internet such as posting fake protest images by Young congress official Twitter handle, follwed by many congress leaders like Manish Tiwari etc. to raising anti-Modi slogan - in full public view, a man threatened that PM Modi will meet the same fate as that of former PM Indira Gandhi. Clearly, this kind of remark can’t be made by a simple farmer. This is the language of the Khalistan extremists, and now this incident points to their involvement in the farmers’ agitation.
However, in a time of social distancing, why farmers are out on the road, protesting against laws that promise to better their lot with freedom to choose their markets and set their own prices?
In this specific blog will update you on one of the three bills in detail (Other two will be continued on two seperate standalone blog)
1. FREE MARKET
The Farmers’ Produce Trade and Commerce (Promotion and Facilitation) Bill, 2020 has been passed in both Houses of Parliament. Once it becomes law, farmers will be free to sell their produce anywhere in India. At present, the crop procurement system is loaded against them:
* Farmers bring produce to designated ‘mandis’ (agri markets) regulated by states under their Agricultural Produce Marketing Committee (APMC) laws
* Farmers are forced to sell crops through licensed ‘commission agents' (known as ‘arhatiyas’ in Punjab and Haryana) at mandis. Only six states/UTs – Bihar, Kerala, Manipur, Lakshadweep, Andaman & Nicobar Islands and Daman & Diu – don’t have APMC Acts
* Commission agents earn 1.5-3% of sale value for services, including cleaning, sorting, displaying and auctioning crop, while states earn ‘mandi fees’ paid by crop buyers
* Government agencies, including Food Corporation of India (FCI), buy produce meeting quality standards at minimum support price (MSP) in a procurement operation that lasts 60-90 days. Thereafter, private traders buy produce through commission agents at market price (not MSP)
How it hurts farmers?
* Farmers not free to sell produce anywhere they like
* Don’t have storage facility, so can’t wait for better prices
* Forced to sell much below MSP if procurement is delayed
* Cartel fixes prices after procurement period
* Farmers at mercy of commission agents, who lend them money for farm and personal expenses. Each agent has at least 50-100 ‘dependent’ farmers
* Often, agents buy crops at low market rates, store them and later sell at MSP in the next procurement season
* Government’s MSP ends up in agents’ pockets instead of benefiting farmers
How the new law helps farmers?
* Farmers choose their markets
* Farmers free to sell at their farm gate or to a cold storage, warehouse or processing unit in their own state or outside
* Direct marketing of produce saves them agents’ cut
* Don’t have to pay cess or levy on sale of produce, nor bear transport costs
* Mandis forced to become more competitive
Who is protesting, and why?
* Farmers: They think the new laws will eventually end MSP support, although the government says MSP-based procurement will continue. Farmers want a legal guarantee that no procurement will happen below MSP anywhere in the country.
Also, the protests are largely confined to Punjab, Haryana and western UP, where the big farmers have gained the most from the MSP system in the decades since the Green Revolution. These farmers are concerned about losing their ‘assured income’. Government data shows 95% of paddy farmers in Punjab and about 70% in Haryana benefit from MSP, as against less than 12% at the national level
* Commission agents: Their monopoly and fat profits are at stake
* State governments: Stand to lose sizeable revenue from mandi fees, especially in the ‘Green Revolution belt’ of Punjab, Haryana and western UP
* Political parties: Ruling parties in states don’t want to lose mandi revenues. Besides, commission agents prop up local netas in both ruling and opposition camps with funds
Sources: Times of India, Zee News
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