It feels quite disastrous to have an uninterrupted tradition in developing countries of governments using price and tax policies to benefit the urban sector at the cost of rural. Nobel laureate Abhijit V Banarjee and Esther Duflo introduced the agricultural marketing boards in Africa during the 1970s as a cruel joke since many of the boards pretended to serve the rich at the cost of the poor(Good Economics For Bad Times,2019).
In India, we are similarly facing a vicious circle, but in a more dangerous way, as it targets the utterly rich, which is a small percentage of the total population. As what we call crony capitalism or Musolian fascism, India is seeing a great fusion amid power and corporates. The new farmer’s law is the latest version of corporate slavery that completely negates the basic cause of farmer’s distress and puts them in a severe vicious circle of poverty.
It was just two years ago, where one lakh farmers from 200 organizations marched towards Delhi, seeking the help of the government to write off the bad debts and ensure a minimum price for the agricultural products. It was in 2006, a committee headed by MS Swaminathan, popularly known as the father of the green revolution submitted five reports, mainly concentrating on the importance of land reforms. It was the same committee that introduced the C2 formula for calculating the minimum price. It included all expenses like interest and rent. It also requested to ensure 150 percent of the minimum price to total expenditure. Moreover, the commission warned the intervention of corporates in the agricultural sector. Interestingly, one of the main offers forwarded by NDA during the 2014 election was the implementation of Swaminathan committee’s instructions. Six years have passed, the nation has not witnessed any agricultural policies that firmly follow Swaminathan committee instructions.
In the book ’What economy needs now?’, edited by Nobel laureate Abhijit V Banarjee, Professor Neelkanth Mishra forwards 14 points that needed to be implemented in the agricultural sector. It clearly explains the problem created by APMC (Agricultural produce market committee), which has now turned as a monopoly in the agricultural market.
What makes the new bills more controversial is its negation over the needs of farmers, Swaminathan committee reports, and the research studies forwarded by prominent economists. Then to whom, the government is addressing the new farmers bill. Let us take the three bills in detail.
- The farmers produce trade and commerce (promotion and facilitation) act, 2020: In the British period itself India was familiar with APMC’s. It ensured the farmers to have minimum prices even when the market faces a demand shortage. Those intermediaries were given wages and the state government earned tax from it. As usual in all government forms, this system was then negatively used by the officials and it resulted in low prices for the farmers. Yashvant Sinha, the finance minister of Vajpayee government points out this problem by exemplifying the realities of cauliflower farmers from Ranchi district(The Unmade India,2018). As a remedy for this problem, new law allows agricultural markets in and outside APMC’s. It conveys that farmers will definitely get profited with good prices but how? How much opening of the market will ensure good prices to poor farmers? Actually, it was demanded to have the APMC’s with no corruption and with good E-platforms and rules. As per the new law, the market will definitely get stolen by the corporates.
- The Farmers (Empowerment and Projection) Agreement on Price Assurance and Farm Services Act, 2020: it empowers direct agreement between farmers and traders. But it feels terrible when it reveals that farmers are not even aware of the market price that their goods have. Neelkanth Mishra points out that around 60 percent of Indian farmers are not aware of the actual market rates of their goods. Dealing with a problem without knowing or hiding its basis will vividly destruct the economy and the nation itself.
- The essentials commodities (Amendment) Act, 2020: This was a law even demanded by Abhijit Banerjee to open a market for certain agricultural goods for boosting the market and to control the monopoly in it. But unfortunately, the new law has used this loophole to open the market even in essential goods which may negatively affect the farmers. Excluding potatoes, onions, oil, and other essential goods from the list triggers utter shock and anxiety among commons.
Theoretically, here we can see a competition between the independent market and closed market. Independent market, which seems to be a great failure in the agriculture sector all around the world, is somewhat re-thinkable and quite examined. The new law allows private firms to hoard essential goods and speculate on the market.
As per Pradhanamanthri Kisan Yojana, it is believed that in India, there are 15 crore farmers which is actually bigger in numbers in terms of real calculation. From this 15 crore, 85 percent of farmers belong to low-class families. It is horrible while calculating the numbers of suicide in the agriculture sector which may count to ten thousand per year in India. Moreover, the agricultural sector is the biggest sector that Indian people seek for employment. Without acknowledging these realities, implementing a corporate favor law will have to definitely pay in the future.
