Lok Sabha Question No. 286 (UNSTARRED), answered on 2020-09-15
Subject: Reforms in Agriculture Sector
Ministry: AGRICULTURE AND FARMERS WELFARE
Asked by: Ajay (Teni) Misra

## GOVERNMENT OF INDIA MINISTRY OF AGRICULTURE AND FARMERS WELFARE DEPARTMENT OF AGRICULTURE, COOPERATION AND FARMERS WELFARE

## LOK  SABHA UNSTARRED QUESTION NO. 286

TO BE ANSWERED ON THE 15 TH  SEPTEMBER, 2020

## REFORMS IN AGRICULTURE SECTOR

286.   SHRI AJAY KUMAR MISRA TENI:

Will the Minister of AGRICULTURE AND FARMERS WELFARE कृ ष एवं कसान कयाण मंी be pleased to state:

- (a): whether  there  has  been  a  demand  for  a  long  time  to  make  several  changes  in agriculture sector and if so, the details thereof;
- (b): whether  the  Government  has  issued  an  ordinance  to  implement  the  said  reforms immediately;
- (c): if  so,  the  details  thereof  alongwith  the  way  in  which  these  reforms  are  likely  to  be affected by the role of the States;
- (d): whether fostering trust between the farmers and companies in contract farming and by removal of some agricultural commodities from the Essential Commodities Act may lead to increase in hoarding and price rise;
- (e): if so, the details thereof; and
- (f): whether the Government has formulated any scheme to deal with these situations?

## ANSWER

## MINISTER OF AGRICULTURE AND FARMERS WELFARE

कृ ष एवं कसान कयाण मंी (SHRI NARENDRA SINGH TOMAR)

- (a) to (c): From time to time there have been demands of to make changes in agriculture sector with regard to reforms in  marketing of agriculture produce  so  as to  ensure remunerative price to farmers. Also demands were there for creation of an ecosystem where the  farmers  and  traders  enjoy  freedom  of  choice  and  a  facilitative  framework  for  fair  and transparent trade of agriculture produce.

Government  of  India  has  promulgated  the  following  three  Ordinances  to  implement reforms in agriculture sector-

## i) The Farmers' Produce Trade & Commerce (Promotion and Facilitation) Ordinance, 2020

ii)  The  Farmers  (Empowerment  an  Protection)  Agreement  on  Price  Assurance  and  Farm Services Ordinance, 2020

## iii) The Essential Commodities (Amendment) Ordinance 2020

The Farmers' Produce Trade and Commerce (Promotion and Facilitation) Ordinance, 2020  provides  for  the  creation  of  an  ecosystem  where  the  farmers  and  traders  enjoy  the freedom  of  choice  relating  to  sale  and  purchase  of  farmers  produce  which  facilitates remunerative  prices  through  competitive  alternative  trading  channels;  to  promote  efficient, transparent  and  barrier-free  inter-state  and  intra-state  trade  and  commerce  of  farmers produce outside the physical premises of markets or deemed markets notified under various State Agricultural Produce market legislations; to provide a facilitative framework for electronic trading and for matters connected therewith or incidental thereto.

The Farmers (Empowerment and Protection) Agreement on Price Assurance and Farm Services  Ordinance,  2020,  provides  for  a  national  framework  on  farming  agreements  that protect s and empower s farmers to engage with agri business firms, processers, wholesalers, exporters or large retailers for farm services and sale of future farming produce at a mutually agreed  remunerative  price  framework  in  a  fair  and  transparent  manner  and  for  matters connected therewith or incidental thereto.

The  Essential  Commodities  (Amendment)  Ordinance  2020  aims  at  increasing  the competitiveness  in  the  agriculture  sector  and  enhancing  the  income  of  the  farmer  by liberalizing the regulatory system while protecting the interests of consumers. The Ordinance allows  the  Central  Government  to  regulate  the  supply  of  certain  food  stuffs  only  under extraordinary  circumstances  (such  as  war,  famine,  extraordinary  price  rise  and  natural calamity of grave nature).

It  is  envisaged  that  the  reforms  will  be  implemented  with  active  participation  and cooperation of the States.

(d) to (f): No  commodity  has  been  removed  from  the  Essential  Commodity  Act.    The Ordinances collectively seek to (i) facilitate barrier-free trade of farmers produce outside the markets  notified  under  the  various  state  APMC  laws,  (ii)  provide  a  frame  work  that  will mitigate  the  risks  for  the  farmer,  enhance  their  income  and  put  in  place  an  effective  and conducive policy regime for farming agreements and (iii) impose stock limits on agricultural produce only if there is a sharp increase in retail prices.

These reforms will help to reduce the unpredictability of agriculture and allows farmers to plan better the production and sale of their agriculture produce and an eco-system will be developed for the holistic development of agriculture sector.

Rules  have  been  notified  to  facilitate  the  implementation  of  the  Farmers'  Produce Trade  &  Commerce  (Promotion  and  Facilitation)  Ordinance,  2020    and  The  Farmers (Empowerment an  Protection) Agreement on Price Assurance and Farm Services Ordinance, 2020

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