Farm bills are nothing but corporatisation of agriculture

Apparently everything seems to be running smoothly. Here, I am not referring to the pandemic. The effects of the pandemic are overwhelming and nobody knows how long it is going to stay here and what more trail of destruction it is going to leave when it goes. But that apart business is as usual for the government.

The pandemic is handing them new opportunities of suppression. What happened in both the Houses of Parliament recently? Both the houses transacted business as usual throwing the parliamentary norms and etiquette to the wind. Nothing said is better about the Lok Sabha where ruling party is its absolute master. For the BJP passing a bill in Loka Sabha is like clicking the fingers. No discussion and nothing. Introduce a bill and just pass it. But the same circus was being enacted in the Rajya Sabha as well.

The latest victims were the farm bills. What was there in these bills that some were opposing them so much and the government is so euphoric about them that they wanted to force pass them in Rajya Sabha.

The three Bills in question are the Famers Produce Trade and Commerce (Promotion and Facilitation) Ordinance, 2020, the Farmers (Empowerment and Protection Agreement on Price Assurance and Farm Services Ordinance, 2020, and the Essential Commodities (Amendment) Ordinance, 2020. The easy way of understanding the issues concerned with the bills is listening to or reading P. Sainath on these.

In a number of interviews Sainath has explained in details the implications of these bills. Why is agriculture important for us? It is important because it employs more than 60 % of our work force and its contribution in the GDP is about 18%. If the farm sector ails, India ails. But this sector is already ailing.  And the remedy this government is offering to augment this sector is hilarious.

Let us discuss first the Farmers’ Produce Trade and Commerce Bill which is also known as the APMC [Agriculture Produce Market Committee] Bill. The government is saying that they have brought this bill to liberate the farmers from the clutches of the APMC so that the farmers can sell their produce to anybody outside the APMC for a better deal and thus improve their income. What was the basic objective of APMC?

The basic objective of APMC was to purchase agricultural produce from the farmers on minimum support price (MSP). Now see what Mr Sainath had to say in an interview in the Wire about it.

“But, here you have, one Bill that posits the APMC as some sort of hideous monopoly from which you are releasing, liberating the enslaved farmer, right? You have another on contracts, which, the entire bill is about written agreements but nowhere mandates written contracts, it does not mandate things in writing, it makes that voluntary…

“Now, the first thing, the idea that the APMC is controlling everything, it’s so stupid, simply because the bulk of transaction of marketable surplus and agriculture have always been outside the gates of APMC; most farmers – the vast majority, it varies region by region, but an incredible percentage of farmers – park their produce at the farm gate because they’ve already got ‘pre-contracts’, unwritten contracts with sahukars, with commission agents, with big creditors, so they’re anyway releasing there; they haven’t realized even the MSP that is possible at the APMC.

“So, in fact, what we’re doing with this agreement, with this law, is that we are exponentially expanding the reality of non-state monopolies. So, if 98% of transactions were taking place in the APMC and you say I want to break that… you know, just check how many farmers actually access MSP, how many of them are able to, because you’ve not been able to break farm indebtedness, you’ve not been able to break the hold of private profiteers over farm produce. Most farmers do not control the price of their produce anyway.”

In the name of increasing farm income the government is withdrawing whatever little support the farmers were getting in the form of MSP by weakening the APMC. It is not that earlier farmers were not selling their produce outside the APMC as mentioned by Sainath. They of course did that whenever they could bargain a better price. But when they didn’t get that they could at least fall back on the APMC because it guaranteed them the MSP.

Now without the MSP the prices will be driven by the market and farmers would be exposed to the market volatility. If they get a better deal it is fine. But if the prices fall drastically there is none for them to fall back on. In the same way when the essential commodity tag is removed from the basic food items there will be no price restrictions on them. If the farmers get a better price that is well and good. But if they don’t how will they recover the cost of production without any government support?

Farm sector is an independent sector to a large extent. It was the responsibility of the government to support this sector. Now with these bills the government is completely making it dependent on corporate monopoly. It is not liberating the farm sector; it is the corporatization of the farm sector.

The farmers have realized this better than us and they are already up in arms against these bills. These bills will do the same thing to agriculture what demonetization and GST did to our economy.