FAMERS ACT BILL

FAMERS ACT BILL

The Centre has asked all states and Union Territories to tighten security during Tuesday’s ‘Bharat Bandh’ called by the farmers unions and supported by opposition parties, while asserting that peace and tranquility must be maintained on that day, officials said. In a countrywide advisory, the Union Home Ministry also said the state governments and UT administrations must ensure that the Covid-19 guidelines issued with regard to health and social distancing are strictly followed. The ‘Bharat Bandh’ has been called by the farmers unions who have been protesting the three farm laws enacted in the Monsoon Session of Parliament. Major political parties on Sunday came out in strong support of the bandh.

Here is all you want to know about new farm laws.

1. Key provisions of the laws
The key provisions of new farm laws are intended to help small and marginal farmers (86% of total farmers) who don’t have means to either bargain for their produce to get a better price or invest in technology to improve the productivity of farms. The Act on Agri market allows farmers to sell their produce outside APMC ‘mandis’ to whoever they want. Anyone can buy their produce even at their farm gates. Though ‘commission agents’ of the ‘mandis’ and states could lose ‘commissions’ and ‘mandi fees’ respectively (the main reasons for the current protests), farmers will get better prices through competition and cost-cutting on transportation. The law on contract farming will, on the other hand, allow farmers to entera contract with agri-business firms or large retailers on pre-agreed prices of their produce. This will help small and marginal farmers as the legislation will transfer the risk of market unpredictability from the farmer to the sponsor. The third law seeks to remove commodities like cereals, pulses, oilseeds, edible oils, onion and potatoes from the list of essential commodities. This provision will attract private sector/foreign direct investment into the agriculture sector.

2.What farmers fear:
Farmer unions in Punjab and Haryana say the recent laws enacted at the Centre will dismantle the minimum support price (MSP) system. Over time big corporate houses will dictate terms and farmers will end up getting less for their crops, they argue. Farmers fear that with the virtual disbanding of the mandi system, they will not get an assured price for their crops and the “anthias” — commission agents who also pitch in with loans for them — will be out of business.

3. Farmers demands:
The key demand is the withdrawal of the three laws which deregulate the sale of their crops. The farmer unions could also settle for a legal assurance that the MSP system will continue, ideally through an amendment to the laws. They are also pressing for the withdrawal of the proposed Electricity (Amendment) Bill 2020, fearing it will lead to an end to subsidized electricity. Farmers say rules against stubble burning should also not apply to them.

4. How MSP affects farmers
MSP is the minimum price paid by the government when it procures any crop from the farmers. It is announced by the state-run Commission for Agricultural Costs and Prices (CACP) for more than 22 commodities on an annual basis, after calculating the cost of cultivation. Food Corporation of India (FCI) — which is the main state-run grain procurement agency — largely buys only paddy and wheat at these prices. The FCI then sells these foodgrains at highly subsidized prices to the poor and is thereafter compensated by the government for its losses.

5. What the government says
The three farm laws have been projected by the government as major reforms in the agriculture sector that will remove middlemen and allow farmers to sell anywhere in the country. Until 2020, the first sale of agriculture produce could occur only at the mandis of the Agricultural Produce Marketing Committee (APMC). However, after the Farmers’ Produce Trade and Commerce (Promotion and Facilitation) Act, 2020 came into force it allows farmers to sell outside APMC mandis in India.