Lok Sabha passes farm bills amid opposition from farmers, political parties; what you should know about legislations

The Bills, which were first introduced ordinances on 5 June, seek to pave the way for private players to purchase agriculture produce outside APMCs and amend the various laws capping their stockpiling, procurement and storage

FP Staff September 18, 2020 20:56:58 IST
Lok Sabha passes farm bills amid opposition from farmers, political parties; what you should know about legislations

Representational image. Reuters.

Lok Sabha, passed the controversial Farmers' Produce Trade and Commerce (Promotion and Facilitation) Bill and the Farmers (Empowerment and Protection) Agreement of Price Assurance and Farm Services Bill on Thursday, following which a minister from Shiromani Akali Dal (SAD), one of BJP's oldest ally, quit the Cabinet as mark of her protest.

The Bills, which were promulgated as ordinances on 5 June, seek to pave the way for entry of private players in agriculture and promote hurdle-free sale of produce, which until now were regulated by various laws capping stockpiling, procurement and storage to ensure food security. However, protesting farmers argue that the new bill will bring about corporate dominance in the agro sector.

Various opposition parties also opposed the legislation arguing that the much touted reform will pave the way for privatisation of agricultural sector. Despite being an NDA ally, SAD too vehemently opposed the legislation leading to thee dramatic resignation of Food Processing Industries Minister Harsimrat Kaur Badal announced at the floor of Lok Sabha by her husband and party president Sukhbir Singh Badal.

The Bills were passed two days after the Essential Commodities (Amendment) Bill, 2020 was passed by the Lok Sabha. The proposed legislation seeks to remove commodities like cereals, pulses, oilseeds, edible oils, onion and potatoes from the list of essential commodities, ending the imposition of stock-holding limits except under extraordinary circumstances.

After the passage of the Bills, Union Minister Narendra Singh Tomar said farmers will now have freedom for direct marketing of their produce and will be able to get better prices. The minister, however, clarified that the Minimum Support Price (MSP) procurement system will continue to remain in place.

Farmers' Produce Trade and Commerce (Promotion and Facilitation) Bill, 2020

The Bill seeks to provide for the creation of an ecosystem where the farmers and traders enjoy the freedom of choice relating to sale and purchase of farmers' produce, as against an older system where the farmers were allowed to sell their produce to only a few licensed traders at their nearest agricultural produce market committee bazaar.

The bill, by removing these limitations, envisions an environment where remunerative prices for agricultural goods can be facilitated through competitive alternative trading channels.

Under the Bill’s provisions, farmers will not be charged any cess or levy for sale of their produce under this Act. They can straight up trade their goods to a private player. Furthermore, there will be a separate dispute resolution mechanism for the farmers. The bill also has provisions to help farmers of regions with surplus produce to get better prices for their produce, according to PIB. 

Farmers (Empowerment and Protection) Agreement of Price Assurance and Farm Services Bill, 2020

The Bill seeks to provide for a national framework on farming agreements that protects and empowers farmers to engage with agri-business firms, processors, 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.

The bill is intended to shift the risk of market unpredictability from the farmer to the sponsor and also enable the farmer to access modern technology and better inputs. It will reduce cost of marketing and improve income of farmers. The proposed legislation will act as a catalyst to attract private sector investment for building supply chains for supply of Indian farm produce to national and global markets.

Sale, lease or mortgage of farmers’ land is totally prohibited and farmers’ land is also protected against any recovery under the Bill.

Treasury, Opposition Benches clash over Bills

Moving the two Bills for passage in the House, Tomar said that the two bills aim to make farmers prosperous and legislations will not impact the provisions of minimum support price (MSP).

He said the bill does not encroach on the rights of state Agriculture Produce Marketing Committee (APMC)s and inter-state trade can take place. Tomar said the states impose levies to the tune of 2 to 8.5 percent as mandi tax, but under the new regime farmers need not pay these taxes if they choose to sell their produce outside the APMC framework.

"These two bills make farming profitable and prosperous and will also give freedom to farmers. Farmers will have the right to sell their produce to anyone. There will be no tax of state government or central government on trade outside mandis. Now only 50-60 people do trade in mandis and competition exists among themselves," the minister said.

Tomar said that these bills will be able to meet the requirements of farming in the future and lead to more investment in agriculture.

Meanwhile, the Opposition slammed the Centre for stepping in states’ domain, also claiming that the bill will corporatise farming to benefit the traders. "There is a sinister attempt by the Centre to legislate on subjects under the state list," said Mahua Moitra, Trinamool MP.

Opposition MPs said the Bills would take away the safety nets provided by the state regulations through the APMC Act, while also eroding the revenue sources of the states. Congress’ Jasbir Singh Gill said large traders and corporate will destroy the small farmers.

Congress deputy leader in Lok Sabha Gaurav Gogoi said, "This Government has been eying, how they can take the farmers’ land to benefit their capitalist friends, whether in the Land Acquisition Act, whether in the industrial system through the weakening the labour courts and now this three pronged attack."

Trinamool Congress’s Kalyan Banerjee said any agreement under the new law would be between two unequal parties as farmers would have unequal bargaining powers.

The Congress said the farm sector legislations brought in by the government defeat the purpose of the Green Revolution and will be "a death knell for the future of farming". Congress MPs staged a protest in front of Mahatma Gandhi's statue in the Parliament cmplex, while Gill, Ravneet Singh Bittu, Gurjit Singh Aujla and Amar Singh burnt copies of the Bills.

Farmers stage protest against Bills

Farmers blocked major highways in parts of Punjab and Haryana on 16 September to demand that the proposed laws should not be pursued in Parliament. Protesting farmers opine the Centre’s repeated assurances that the MSP will continue is deceptive and fear that the Centre will end the current system of open-ended Food Corporation of India procurement, leaving them at the mercy of traders' predatory practices.

Over 250 farmer and farm-worker organisations, under the umbrella of All India Kisan Sangharsh Coordination Committee (AIKSCC), have given a call for a Bharat bandh on 25 September.

Farmers in Punjab have organised a three-day protest against the Bills. They will stage a ‘rail roko’ agitation across the state from 24-26 September, a farmers’ body said. Despite reassurances from the government, farmers believe that the bills will render the current MSP procurement system ineffective, leaving them at the mercy of “big farmers”.

In Haryana, as many as 17 farmer outfits that have joined hands under the flag of the Bharatiya Kisan Union (Chaduni) and announced continuation of their protest across the State. “On September 20, we will block all major roads between 12 noon and 3 pmin protest against the Bills. We will also support the ‘Bharat bandh’,” Rakesh Bains of the BKU, said, according to The Hindu.

Farmers want MSPs to be at least 50 percent over their weighted average cost of production and non-payment of MSPs to be recognised a punishable offence. “Once sales move out, they wouldn’t be recorded as APMC sales and there would be no benchmark,” agricultural activist Kiran Kumar Vissa said, according to a Down To Earth report.

With inputs from PTI

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