Farm Bills 2020

 It is time farmers reconcile to the new agricultural reality 

As we write this piece, the protests over the Farm Bill 2020 are still raging on the outskirts of Delhi. Farmers, especially from Punjab and Haryana, are totally disillusioned with the Farm Bill and want a total recall. It is time the farmers reconcile with the new agri-reality in India. Green Revolution is history! 

But, why are farmers so upset? 

There are a number of reasons why the protesting farmers are terribly upset. Firstly, they believe that the Farm Bill is a virtual sell-out to large corporate groups, which will dominate farming. There is also a second worry. In fact, the bigger worry for most farmers is that the Farm Bills encourage farmers to directly sell to the private companies without involving the APMC mandis. The fear is that this would eventually lead to the scrapping of the minimum support price (MSP) mechanism which assures farmers a lucrative price today. 

The third fear that farmers have is that by moving most goods out of Essential Commodities list, it would allow large corporates and wholesalers to stock pulses, grains and even vegetables and fruits; leading to artificial shortages in the market. But the real worry is a lot more pragmatic. Large farmers worry that they would lose out on lucrative commission income. Also, the mandi tax accounts for 9% of the state revenues in Punjab and Haryana, which is why the state governments are concerned. 

Green Revolution mindset 

If one looks at it pragmatically, the MSP is actually enjoyed only by 6% of the farmers in India. The rest of them sell at market prices. States like Bihar have scrapped the APMC long back and the system is working perfectly fine. The whole idea of MSP and APMC mandi procurement are relics of the Green Revolution. That was the period of huge shortages in food grains. That is why the government had to intervene and ensure good prices and also equitable distribution. Today, India is a surplus producer of most food grains and pulses and the need of the hour is market driven pricing with some checks and balances at the macro level. That is what the government is offering now. 

Time to meet half-way 

While solutions are tough, it is time to meet half-way. The government should assure continuation of MSP for some more time and gradually phase it out. If the farmers can be free of the APMC monopoly and get a better price, then that is only better for the farmer. The global experience has been that market driven agriculture eventually benefits the farmers, the corporates and the consumers also. Farmers of Punjab and Haryana are worried about the loss of status quo and that is natural. The onus is on the government to give comfort. On their part, the farmers must really give markets a chance to succeed!