The farmers’ movement against public policies and laws on the agriculture sector did not begin last week. In truth, protests that started two months ago found the media’s attention last week when farmers from Punjab and Haryana decided to enter Delhi.
In further truth, farmers have been sitting in dharnas and marching in protest since 2017 in various pockets of the country after the droughts of 2014 and 2015. However, the three farm laws brought by the government in September earlier this year were the straw that broke the camel’s back.
After a week of agitation, with the farmers demanding a repeal of the three laws (among other demands), the Central government officials met with the Punjab farmers and rejected all demands. The ministers, however, offered to set up a small expert committee, which was refused by the farmers’ groups.
“This is a fraud being played by the government,” said MG Devasahayam, Former Chief Secretary, Government of Haryana, who was a part of a High-Powered Committee on Agricultural Policies and Programmes in 1990 and recommended on the pricing of agricultural commodities. “The issue has been known to the government for over 40 years now and since then, many committees on agriculture policies have come and gone. At the height of the agitation, the demands of the farmers are plain and simple – i.e. repealing of the three laws – and the proposal of setting up another committee must be rejected,” he added. He was speaking at the press conference organised by a gathering of civil society groups on December 2, 2020.
Also present at the conference was P Sainath, journalist and founder of People’s Archive of Rural India. “For the past 15 years, governments have been sitting on the MS Swaminathan Commission report and haven’t dedicated even a single day in the Parliament to its outcomes. How will another small committee make a difference,” he said. Submitted in five reports over six volumes in October 2006, the Committee’s Minimum Support Price (MSP) formula has been recommended widely by experts.
The farmers have made it clear. A withdrawal of the laws is what they want, not another committee to have their anger muffled. But why is it that the farmers are not open for a negotiation? What do these laws have that the government was shy of taking their opinion on?
a) Farmers’ Produce Trade and Commerce (Promotion and Facilitation) Act, 2020
What the government claims the Act will do: The Act will allow farmers to sell their produce directly to corporates or private individuals instead of relying on Agricultural Produce Market Committee (APMC) mandis set up by the government. This will invite private investment in agriculture and farmers able to get a higher price for their produce due to the disappearance of middlemen.
What the Act will actually do: Farmers already have the freedom of choice to sell to anyone without having to go to AMPCs. In fact, most farmers directly sell their produce to private traders and not mandis, said R Ramakumar, professor of developing economies at Tata Institute of Social Sciences (TISS). He said that opening up trade doesn’t guarantee private investment and Bihar is an example. In 2006, Bihar abolished its AMPC system. Since then, unregulated and unscrupulous traders have taken over agricultural trade, leading to difficulties for farmers.
In 2020, wheat farmers in Bihar reportedly received 10-12% lower than the MSP. Many of them had to take their produce-laden trucks to Punjab and Haryana, which have a good AMPC system in place, to receive the MSP, said Ramakumar at the press conference. Because this pan-India Act will not guarantee MSP to the farmers, once implemented, farmers will this time have nowhere to drive a good bargain.
b) The Essential Commodities (Amendment) Bill, 2020
What the government claims the Act will do: The government had initially put a stock limit for traders on essential commodities including pulses, onions and potatoes. It was enacted in 1955 to ensure that these commodities are not black marketed or hoarded to manipulate price. Due to this regulation, there was a lack of private investment in storage and warehousing in India. The government maintains that this amendment will remove stock limit on storage, allowing corporate companies to enter this arena of agricultural trade as well. This will lead to higher farm incomes.
What the Act will actually do: According to Ramakumar, there is a shortfall of private investment in storage and warehousing not because of stock limits but because of the structural issues in Indian agriculture – predominance of small and marginal farmers, lack of adequate surplus and aggregation in rural areas and absence of homogeneity in the cropping pattern. What the sector actually needs to strengthen its storage and warehousing infrastructure is more public investment.
c) Farmers (Empowerment and Protection) Agreement of Price Assurance and Farm Services Bill, 2020
What the government claims the Act will do: Most farmers currently rely on government-run mandis for MSP. By encouraging farmers to enter into contract farming, the Act will allow them to directly tie up with large buyers and exporters before sowing. This will get farmers a more suitable price, along with access to high quality seeds and fertilisers.
What the Act will actually do: Contract farming can only work in the favour of farmers if the government ensures good regulation to protect them against the exploitation and malpractice of corporate companies. However, Ramakumar said, this Act includes negligent regulation and doesn’t keep the interest of the farmers at centre.
There is no evidence that contract farming liberate farmers from their poverty-ridden state. In fact, contract farming, as put by Shalmali Guttal, Executive Director, Focus on the Global South, is designed to create dependency by locking those with much less negotiating power with those who have the power of both capital and legal support. There have been instances of companies coming into a contract with a small farmer, giving them particular seeds as per its requirement, and later annulling the contract after the crops have grown, leaving the farmer with no buyer.
Thus, the protest against the reforms are not taking in presumption but in fact, with hindsight.
Putting The Farm Reforms In A Global Context
In the 1980s, the ratio of income per individual in agriculture and non-agriculture sector was 1:2. Today, this ratio is 1:6. Jha explained that this shift happened when India opened doors to privatisation in the agriculture sector in 1991, it cut public spending in social sectors and rural areas. And the present farm reforms are one step further towards free trade. “The plight of the farmers is not a humanitarian crisis or an agrarian crisis, it’s a public-policy-driven crime,” said Jha.
In the past 30-40 years, agricultural reforms all across the developing world have come under the umbrella of neo-colonialism and imperialism. Developed nations including Europe and the US coerce agricultural nations to free trade for global corporations to feed off their land, while ensuring protection of their own farmers.
At the September 2018 meeting of the WTO’s Committee on Agriculture, several countries questioned India for its MSP policies, high subsidy to farmers and an increased import duty. The US even pointed out India’s public stockholding of foodgrains, which has been removed with the recent reforms. In the same year, Jha pointed out, the US gave $90 billion in subsidy to its two million farmers, i.e. $45,000/farmer.
A similar pressure on developing countries to deregulate the agriculture sector and reregulate in favour of corporate interest has proved to be disastrous to farmers and their families across the world, believes Guttal.
In 2002, Malawi faced a famine, leading to thousands of hunger-related deaths, the reason behind which was the sale of the national strategic grain reserve in 2001 on the advice of the International Monetary Fund. Similarly, Guttal said, corporate farming in Thailand, Philippines, Cambodia and many African countries has driven small-scale farmers into severe debt to corporations, moneylenders or banks. They are forced to sell their lands and find work in factories, entertainment industry or sex industry, to name a few, to repay their debts.
What Can Be Done Instead?
These farm laws, Guttal argues, must be seen as part of an overall over-intensification of disinvestment from public sectors and privatisation of public enterprises that are critical to public interest, which includes railways, airports telecommunication, energy, banks and so on.
However, handing over agriculture in the hands of corporates would mean quarrelling with your bread and butter. The laws must be scrapped and instead, the following steps must be taken to strengthen the income of our farmers.
Implementation of a fair MSP: This is the first step to ensure a fair earning to farmers. Despite an existing MSP, only 10-15% of the wheat and paddy farmers are able to access the MSP price at the government mandis. The rest are forced to sell their produce at a lower price. Thus, what is needed is an expansion and institutionalisation of the MSP system. The current government’s own committee has previously mentioned a need for at least 3,000 mandis, in addition to the 7,000 functioning mandis, in order to reach maximum farmers. Unfortunately, not even a single mandi has been opened in the last few years, Ramakumar stated.
Consultation of states: The establishment of a private market already falls under the purview of state legislation. This makes the three farm laws unconstitutional. Agriculture in Haryana and Punjab is not the same as agriculture in Tamil Nadu and Kerala, and so, a committee sitting in Delhi shouldn’t be framing a single law for all. Hence, the Centre must reframe these laws in consultation with states.
Strengthening of FPOs: Farmers must be encouraged to form farmers collectives, called Farmer Producer Organisation, so that they can bargain with corporate companies for a better deal.
Income-support model: India must adopt a minimum-income model or improve its minimum price model to support the deteriorating income of its farmers.
Addressing women farmers: There is no recognition of the existence of women farmers and agriculture workers in any of the three farm reforms, Annie Raja, General Secretary of National Federation of Indian Women, pointed out. Even during the protests, the agency of women protests is being ignored by falsely claiming that they are getting paid Rs 100 to participate in the protest.
All three introductions in the legislation are intricately linked together to enable a corporate takeover of the agricultural market, leaving farmers to the mercy of corporates. The Indian civil society must unite with the farmers and protest for their demands.
Note: All inputs and quotes have been taken from a press conference by Nation for Farmers on December 2, 2020.