Why Farmer’s protest in India justifies or not?
Tags: Ecommerce, Corporate Culture, Farmers, Indian Politics, Suicide Awareness

Source: news18.com

The Government of India has recently passed three bills/amendments in bills which since then has turned into ongoing havoc for the country on top of a pandemic. With a lot of people arguing for the bill whats’s so wrong with it that even in a pandemic lacs of people mostly farmers are on the roads while the COVID-19 cases are again on the rise?

The ruling party, BJP leaders are continuously arguing that the recent legislation made by the government is revolutionary and only came in the interest of the farmers. They further argued that all this havoc is only made up by the opposition to defame the government and procuring vote banks. But if the laws are so good as argued and for the betterment of the farmers, why it’s so difficult for the government to communicate this to the farmers but easy for the opposition to manipulate?

One can put a lot of questions over the current situation but with no satisfactory answers so let’s put some lights on the laws itself:

Laws

expands the scope of trade areas of farmers produce from select areas to “any place of production, collection, and aggregation”.

allows electronic trading and e-commerce of scheduled farmers’ produce.

prohibits state governments from levying any market fee, cess or levy on farmers, traders, and electronic trading platforms for the trade of farmers’ produce conducted in an ‘outside trade area’

2. Farmers (Empowerment and Protection) Agreement on Price. Assurance and Farm Services Act, 2020

provides a legal framework for farmers to enter into pre-arranged contracts with buyers including mention of pricing.

defines a dispute resolution mechanism.

3. Essential Commodities (Amendment) Act, 2020

allows for the centre to regulate food items through essential commodities.

requires that imposition of any stock limit on agricultural produce be based on price rise.

Background of the Indian farmers

India’s agricultural has about 18% contribution to GDP and more than 50% contribution in the overall employment of the country(more here) perhaps one of the reasons India is among the least hit country over a pandemic seeing the number of cases. Yet a lot of the farmers are illiterate which is also one of the reasons to join farming at the first place as it requires less expertise and governments has been doing a lot in educating the farmers for better output from their fields. Not just that there is also an increasing number in suicides of farmers in the country ranging up to 10/day (more here) due to debt as a major reason means farmers in India are not necessarily rich and need funds time to time to make their living.

APMC

An Agricultural Produce Market Committee (APMC) is a marketing board established by a state government in India to ensure farmers are safeguarded from exploitation by large retailers, as well as ensuring the farm to retail price spread does not reach excessively high levels.

APMCs operate on two principles:

Ensure that farmers are not exploited by intermediaries (or money lenders) who compel farmers to sell their produce at the farm gate for an extremely low price. All food produce should first be brought to a market yard and then sold through auction.

Role of Arhtias

Arhtia is a middle man between the farmer and the buyer but has a major role than said. In the Sushma Swaraj (a leading BJP leader and ex-Minister of External Affairs) words:

“To the farmers Arhtias are like ATM they can go to and get instant money.”

Now, this can also lead to increased debt sometimes that might bring unsustainable conditions to the borrower if not went well. But even then Artia is still helpful when to comes to selling the crops as Artias works as an instant buyer of the farmer’s crops which otherwise is a time-consuming process if sold directly in the government mandis or APMC because even after delivering the corps at the APMC mandis the payments for the same are not instant as the crops need to be auctioned and the final payments can take up to one or two months!

MSP

MSP or Minimum support price is fixed by the central government for the farm commodities suggested by CACP which currently recommends 23 commodities which include 7 types of cereal, 5 pulses, 7 oilseeds and 4 commercial crops(includes sugarcane).

Unlike sugarcane which is governed by Sugarcane (Control) Order, 1966 issued under the Essential Commodities Act, there is no legal act or law that binds either the government or any private player to pay the MSP to procure the other 22 crops for which MSPs are decided.

Note that even in case of sugarcane the responsibility to make FRP or MSP payment to farmers within 14 days of cane purchase lies solely with the sugar mills and not the government (more here).

Pros

The entry of e-commerce players: We cernyshop.in, being an eCommerce marketplace initially wanted to get the farmers online so that they can sell internationally and directly to the buyer rather than to the middlemen. But that was before the new laws were even presented and hence we have to take our steps back seeing the rules at that time but after the new laws are implemented it would bring e-commerce players like us to facilitate farmers reaching new buyers worldwide irrespective of their scale. And as the world is going digital this was a major step required in making the farmers independent for selling their crops.

Ease of trade offline: Apart from the e-tailors, earlier the sale and purchase of the crops was also difficult offline as there were multiple hurdles in the process to ensure non-exploitation of the farmers like the establishment of the APMC, prohibition of mass trade outside the designated fields.

Contract farming: One of the bills also provides the norms to do contracts with the farmers for the complete land they cultivate and hence would be inviting to the large corporates into the agriculture sector and improving it with all the innovations that they come with.

Cons

Danger to the MSP?: Well as explained about MSP is a bare indicator for the right price that a farmer must get as a remunerative, not a binding to pay, not even to the government and the reforms have made no change to it. But to protect farmers interest and the exploitation as now they will be exposed to the corporates, the demand is to make MSPs a legal binding to the buyer.

End of Artias: The impact of the bill will eliminate the role of Artias and ultimately would shut their shops. Now after the Artias closing their business farmers would only be left with the courtesy of the corporates as a way to selling-off their crops instantly for the same reasons mentioned above (selling at APMC is time-consuming and farmers need instant payments and also they don’t have storage warehouses). Now we all know how good corporates are when it comes to courtesy. These are the same corporates who expelled millions of employees in just a month when the pandemic started to takeover.

Abusive contractual farming norms: The Farmers (Empowerment and Protection) Agreement on Price Assurance and Farm Services Ordinance, 2020 provides for a three-level dispute settlement mechanism by the conciliation board, Sub-Divisional Magistrate and Appellate Authority where the highest level of appeal for the farmer against any private entity is the Appellate Authority hindering the farmer from moving to the Court. This is clearly not just suppressing the farmers but also a violation of justice.

Conclusion

The recent changes in the agri-laws clearly describe the motive as to bring the corporates into the agriculture sector and given the background of the farmers and the corporates it’s obvious that it would be an easy task for the corporates to manipulate the farmers if no strict rules are there to abide in the interest of the farmers (which is exactly the reason why farmers were only allowed to sell only in the designated APMC fields for higher output, to safeguard farmers from exploitation of the private players) but unfortunately it is something that the current laws are lacking.

cernyshop.in being an online marketplace and a direct or indirect beneficiary of the recent reforms still in favour of the farmers demands seeing the threat these laws make can’t go ignored.