Farm Bills 2020 - Not Choice, Just Noise
There has been chaos since the Parliament passed three agriculture-related bills. The three bills that were passed by the Modi Government were- The Farmer’s Produce Trade and Commerce (promotion and Facilitation) Bill 2020; The Farmers Empowerment and Protection) Agreement of Price assurance and Farm Services Bill, 2020, and The Essential Commodities ( Amendment) Bill, 2020. The new legislation will create an ecosystem where the farmers and the traders will benefit from the freedom of choice of sale trade and commerce outside the physical premises of markets notified under State Agricultural Produce Marketing legislation.
This is the historic step in providing a vast ground for trading. There will be no regulations as such, no boundaries for the farmers, they can sell their product wherever they want without facing any difficulty. It will open far more choices for farmers, reduce marketing costs for the farmers, and help them in getting better prices and the consumers will be getting the products in lesser amounts. The new 2020 Farmer’s Bill also proposes electronic trading in the transaction platform for ensuring a seamless trade electronically.
The bills allow barrier-free intrastate and interstate trade of farmers’ produce outside. The physical premises of market yards run by the state APMCs and other markets are notified under the state APMC acts, such as sub yards, private market yards, collection centers, and farmer consumer markets. With the Bill, farmers can now go to any state they would like where the demand for their products is high and sell that for a higher price than the price they were selling at the mandis.
Before the Bill passed Farmers had a ton of restrictions when it comes to selling their products in other states. Under the bill, the trade of farmer’s produce can be undertaken anywhere outside such markets, such as in places of production, collection, and aggregation. The main purpose of the first bill is to reduce farmer’s dependence on middlemen of mandis where they used to buy products from farmers at a very cheap price and later on sell those products for higher prices.
Through this farmers can enter into written agreements with anyone, including agricultural companies, and sell them their products for a specific period of time, as per the contract. More and more private firms can now make agreements with the farmers to take their products and give them the money as discussed in the agreement.
The Famer’s Produce Trade and Commerce (Promotion and Facilitation) Bill, 2020 also contains a provision of including electronic platforms, for the convenience in trading. The bill provides for setting up of electronic trading platforms to facilitate direct and online buying and selling of farmer’s produce, resulting in easier physical delivery of the product.
Under the third bill now that the government is not going to store much of the farm products the chance of variance in the supply-Demand chain will be reduced. Why are the farmers protesting? Now that the government is no longer storing much of the products that the farmers are producing if an unwanted or unexpected demand for a specific product arrives the government can no more have the ability to control the demand.
When the Government is not storing the products then the farmers have to look for other options and that is approaching some private cold storages where they collect more money which becomes a burden to the farmers as it is way more expensive than storing them under the government.
In most of the states of northwest like Haryana, Punjab, Chandigarh, the Mandi system works quite well and the farmers have no problem with this system. That’s why the farmers are worried that the new bill will create an abundance in their traditional way of trading. On the other hand, many Southern cities are accepting the new bill and are quite satisfied with the new bill.
Now that the new bills enforced, with the arrival of more big private firms the control of price for the farm products may go to private hands. Also, private companies can be decisive and choose to buy only some specific products and refuse the other products that are produced by the farmers, this will cause a disturbance in trading. Then the farmer has to sow the crop that is in demand and the farmer may become a slave of the big agricultural companies.
The Government should acknowledge the problems that farmers are facing and represent themselves in a way that the farmers understand the values of this bill. A written paper should be presented in front of the parliament so that even the opposition backs the proposal, and everyone gets the point behind this bill. The bill should surely address the issues with a proper and practical solution.