Dr. Satyavan Saurabh
The Bill on Farmers’ Produce Trade and Commerce (Promotion and Facilitation) Bill, 2020; The Price Assurance and Agricultural Services Bill, 2020 and the Farmers (Empowerment and Protection) Agreement, Essential Commodities (Amendment) Bill, 2020 were introduced in the Parliament to replace the ordinances issued during the lockdown on 14 September.
During this time, the opposition members in the Lok Sabha moved a resolution against the Trade and Commerce Ordinance and the Price Assurance Ordinance. Not only this, farmers and peasant organizations across the country have protested against these ordinances. Tractor protests by farmers in Punjab and Haryana were against these in July last. The Punjab Legislative Assembly on August 28 passed a resolution rejecting the ordinances of the Center.
After all, why are they being opposed? Will the new provisions abolish all state APMC laws? Since agriculture and markets are state subjects, then these ordinances are being seen against direct encroachment on the actions of states and the spirit of federalism. However, the Center argued that trade and commerce in food items are part of the concurrent list, thus it is constitutional.
According to PRS Legislative Research, A.P.M.C. Were established to ensure fair trade between buyers and sellers for the effective discovery of the produce of farmers. The APMC can regulate the trade of farmers’ produce by granting licenses to buyers, commission agents, and private markets; Levy market duty or any other charge on such trade; And provide the necessary infrastructure within their markets to facilitate trade.
The second bill aims to open agricultural sales and marketing outside the notified Agricultural Produce Market Committee (APMC) mandis for farmers, which removes barriers to inter-state trade and agriculture. The yield provides a framework for electronic trading. It also prohibits state governments from collecting trade duty, cess, or levy outside the APMC markets.
On the distance, critics see the dissolution of APMC’s monopoly as a direct indication of ending the assured purchase of food grains at the minimum support price (MSP). In response to the Centre’s ‘One Nation, One Market’, critics have demanded ‘One Nation, One MSP’. Critics argue that large numbers of farmers need time to obtain MSP for their produce.
The government announced a 2.6% increase for wheat MSP amid farmers’ protests across the country.
The Cabinet approved the MSP increase for six crops, including a 2.6% increase in the rate for wheat. Last year saw a 4.6% increase in MSP for wheat. The Farmers (Empowerment and Protection) Contract of Price Assurance and Farm Services Ordinance deals with agriculture, which provides a framework on trade agreements for the sale and purchase of agricultural produce.
The wage value structure has been introduced as a protector and empowering farmer.
The written agricultural agreement, entered into before the production or rearing of any agricultural produce, lists the terms and conditions for supply and quality, grade, standards, and price of agricultural products and services. The price to be paid for the purchase is to be stated in the agreement. In the case of prices subject to variations, the agreement must include a guaranteed price paid for such yield, and a clear reference to prevailing prices or any other suitable benchmark prices for any additional amount plus a bonus over the guaranteed price Or should be inclusive of premium. Such a price will be provided as a contract.
Contract farming is not a new concept for the country’s farmers – informal contracts are common for formal contracts in the grain, grain, and poultry sectors. The Price Assurance Bill, while protecting farmers against price exploitation, does not lay down the mechanism for pricing. It is feared that the free hand given to private corporate houses may lead to exploitation of the farmer.
The Third Bill the Essential Commodities (Amendment) Ordinance removes grains, lentils, oilseeds, edible oils, onions, and potatoes from the list of essential commodities. The amendment would deactivate the production, storage, circulation, and distribution of these food items. The central government is allowed to regulate excess supplies during war, famine, and the central government is allowed to regulate supply during the war, famine, extraordinary price increases, and natural disasters while providing discounts for exporters and processors at such times.
Critics speculate that the easing of food regulations will lead exporters, processors, and traders to harvest produce during the harvest season, when prices are generally low, and release it later when prices rise. He said that this could weaken food security as states would not know the availability of stock within the state. Critics speculated irrational volatility in essential prices and increased black market prices.
The bills require that the imposition of any stock limit on agricultural produce should be based on price increases. The way to liberalize agricultural marketing in the new bills is to create more accessible markets and options for the farmer. We need to expand the market for agricultural produce by preserving the ‘safety net’ principle through MSP and public procurement.
(Dr. Satyavan Saurabh is a research scholar, poet, independent journalist and columnist. The views expressed are personal opinion of the author. He can be reached at firstname.lastname@example.org)