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Explained: Why are farmers unhappy with the Agriculture Bills?


New Delhi, Sep 18: The Narendra Modi government move to replace three Bills on agriculture reforms - The Farmers' Produce Trade and Commerce (Promotion and Facilitation) Bill, 2020; The Farmers (Empowerment and Protection) Agreement of Price Assurance and Farm Services Bill, 2020 and The Essential Commodities (Amendment) Bill, 2020 become a bone of contention within the ruling alliance.

Explained: Why are farmers unhappy with the Agriculture Bills?

Farmers and farmer associations across the country have protested against the ordinances.

Agriculture reform bills will lead to increased profits for farmers, forces trying to mislead them: PM

The oldest ally of the BJP, the Shiromani Akali Dal has said it will reconsider its alliance with the ruling National Democratic Alliance (NDA), soon after Harsimrat Kaur Badal resigned as a union minister in protest against the government's agricultural bills that have spurred massive resentment among its all-important voter base of farmers.

    Harsimrat Kaur Badal quits PM's cabinet over farm bills, why is SAD upset with BJP | Oneindia News

    What are the two new farm Bills

    The Farmers' Produce Trade and Commerce (Promotion and Facilitation) Bill, 2020 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 which facilitates remunerative prices through competitive alternative trading channels to promote efficient, transparent and barrier-free inter-State and intra-State trade and commerce of farmers' produce outside physical premises of markets or deemed markets notified under various State agricultural produce market legislations; to provide a facilitative framework for electronic trading and for matters connected therewith or incidental thereto.


    The new legislation will create an ecosystem where the farmers and traders will enjoy freedom of choice of sale and purchase of agri-produce. It will also promote barrier-free inter-state and intra-state trade and commerce outside the physical premises of markets notified under State Agricultural Produce Marketing legislations. This is a historic-step in unlocking the vastly regulated agriculture markets in the country.

    It will open more choices for the farmer, reduce marketing costs for the farmers and help them in getting better prices. It will also help farmers of regions with surplus produce to get better prices and consumers of regions with shortages, lower prices. The Bill also proposes an electronic trading in transaction platform for ensuring a seamless trade electronically.

    The farmers will not be charged any cess or levy for sale of their produce under this Act. Further there will be a separate dispute resolution mechanism for the farmers.

    The Farmers (Empowerment and Protection) Agreement of Price Assurance and Farm Services Bill, 2020 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 and for matters connected therewith or incidental thereto.


    The new legislation will empower farmers for engaging with processors, wholesalers, aggregators, wholesalers, large retailers, exporters etc., on a level playing field without any fear of exploitation. It will transfer 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.

    This 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, and in agricultural infrastructure. Farmers will get access to technology and advice for high value agriculture and get ready market for such produce.

    Farmers will engage in direct marketing thereby eliminating intermediaries resulting in full realization of price. Farmers have been provided adequate protection. Sale, lease or mortgage of farmers' land is totally prohibited and farmers' land is also protected against any recovery. Effective dispute resolution mechanism has been provided for with clear time lines for redressal.

    So, why are the farmers unhappy?

    Farmers have expressed apprehension that once these bills are passed, they would pave the way for dismantling of the minimum support price (MSP) system and leave the farming community at the "mercy" of big corporates.

    The farmers added that the proposed legislations were "corporate agriculture bills" which were framed to suit "big corporates who seek to dominate the Indian food and agriculture business".

    Congress has also suggested some changes in the ordinances to make them farmer-friendly.

    "These ordinances are against the interests of farmers. If the government wants to implement them, then it should ensure that no purchases are made below MSP. The government could bring in a fourth ordinance separately to provide a clear provision that if any agency buys the crop of the farmer below the MSP, then legal action will be taken against it," Hooda said in a statement.

    Senior Congress leader Randeep Singh Surjewala said these ordinances will not only "destroy" farmers, but will also lead a blow to the mandi system and impact farm labourers and ''Arhitiyas'' or commission agents as well.

    What's govt take?

    Agriculture Minister Narendra Singh Tomar said the Minimum Support Price (MSP) mechanism for farmers will continue and that the mechanism will not be impacted by two proposed legislations.

    The minister also clarified that these bills would not have any impact on the Minimum Support Price (MSP) mechanism which will continue.

    Further, he assured that these proposed legislations would not encroach upon the Agriculture Produce Marketing Committee (APMC) Acts of the states.

    "These two bills will ensure that farmers get better prices for their produce. They will not be subject to the regulations of mandis and they will be free to sell their produce to anyone. They will also not have to pay any taxes."

    "These bills will increase competition and promote private investment which will help in development of farm infrastructure and generate employment," Tomar said.

    The minister noted that because of these two reform bills farmers will be able to connect directly with big business and exporters, and will be able to make farming profitable.

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