History Of The Farm Laws and What they Are:

In the recent weeks, India’s capital city, Delhi has witnessed incessant protests by farmers who have repeatedly appealed to the Union Government to withdraw the controversial farm laws which were passed by the Parliament of India in September 2020. They have been an issue of major debate throughout India for the past 2-3 months. So, the major question that plagues the common people in this situation is, to be precise, exactly what these farm laws are, how they came to be and just what was so provocative about them that it triggered such massive protests not just in Punjab or Haryana but nation-wide? This article will attempt to provide the whole matter of the situation in a simplified manner without distorting the facts or views of any group of individuals. However this is only a report which is entirely impartial and matter-of-fact. To come to the heart of the matter, what are the three farm laws? They are the Farmers’ Produce Trade and Commerce (Promotion and Facilitation) Act, Farmers (Empowerment and Protection) Agreement on Price Assurance and Farm Services Act, and the Essential Commodities (Amendment) Act. The last of the three, the Essential Commodities (Amendment) Act is an amendment of the Essential Commodities Act of 1955 which dealt with the control of the production, supply and distribution of certain commodities. It was established to ensure the delivery of certain commodities or products, whose supply if obstructed due to hoarding or other reasons, would affect the normal life of common people in an adverse way. At present there are nine commodities in the list which comes under this act—drugs, fertilizers (organic, inorganic or mixed), foodstuffs including edible oil, hank yarn made from cotton, petroleum and petroleum products, raw jute and jute textiles, seeds of food-crops, fruits, vegetables, cattle fodder, cotton; face masks and sanitisers. The previous law of 1955 prohibited the hoarding and black marketing of essential commodities. Also, if it was found that the price of a certain commodity was going up due to limited supply, the Centre could order the state governments to fix the stock-holding limit of the commodity for a fixed period. The amendments to this law state that stock holding limit on commodities will, from now on, only be imposed under exceptional circumstances like national calamities or famine with a surge in prices. Also, processors and value chain participants have been exempted from the stock limit. The bill also removes commodities like edible oil, onion and potato from the list of essential commodities, meaning that the regulation of the supply of these commodities might be controlled by the government or that it can include these items back into the list only under “extra ordinary circumstances”. Experts believe that the amendments to the Essential Commodities Act are a step in the right direction as it would boost farmers' income, but it may also lead to increase in rural poverty and have an adverse impact on the public distribution system. A common man’s diet includes foodstuffs like pulses, onions and edible oil. The chances of hoarding might increase if the government does not regulate the supply of such stuff. The farmers' income could increase as they would be able to sell their produce anywhere, and not just to the local mandi. Corporatization will occur as large corporates will buy crops directly and it will be remunerative for farmers. Adversely, amendment to the Act would allow big businessmen to hoard essential commodities such as cereals, pulses, edible oil, onion and potato leading to rise in prices. The Farmers’ Produce Trade and Commerce (Promotion and Facilitation) Act or the APMC Bypass bill permits, for the first time, trade in agricultural produce outside the APMC regulated mandis. Private mandis can be set up across the country where anyone can buy produce from farmers. These mandis are also exempt from paying any taxes or fee. The government argues that this is designed to provide farmers with increased choices on who to sell their produce to. But the farmers believe that instead of providing them more choice, with better prices, it would leave them at the mercy of a few private players who would organise as cartels thus setting the price. The Farmers (Empowerment and Protection) Agreement on Price Assurance and Farm Services Act or the Contract Farming Law establishes a national legislative framework to enable contract farming, through which an agreement can be made between the farmer and the buyer before sowing under which the farmer is contracted to sell the produce to the buyer at a predetermined price. The government has argued that this would help remove some income uncertainty by providing the assurance of a buyer at a predetermined price prior to sowing. The opposition to this rises from historical experiences of contract farming in India, which have not always been beneficial for farmers. Agriculture economist Sukhpal Singh has said that contract farming in India involves many malpractices against farmers including “one-sided (pro-contracting agency) contract agreements, delayed payments, quality-based undue rejections and outright cheating, besides poor enforcement of contract farming provisions by the state government.” The history of odds being stacked against farmers in contract and contract farming could enable large corporations to take over their lands as the law lacks adequate redressal mechanisms for farmers. Private firms might also devise complicated procedures and technicalities which would be incomprehensible to small farmers and they would therefore not understand all the clauses as stated in the agreement. Farmers also fear that with the new laws, the government is making a signal at moving away from the current patterns of procurement of crops at MSP (minimum support price). The government has claimed that these Acts would transform Indian agriculture and attract private investment. These reforms are also expected to accelerate growth in the agricultural sector through private sector investment in building infrastructure and supply chains for farm produce in national and global markets. They are also intended to help small farmers who don’t have the means to either bargain for their produce to get a better price or invest in technology to improve the productivity of farms. These are the basic farm laws as stated by the government.