For whom the Farm
Bill tolls?
The new farm acts are detrimental to farmers
-
Suresh Kodoor
Even in this freezing winter, Delhi
is now burning! The power centres in
Delhi are now sweating in the heat of an unprecedented storm of rage. Farmers
are waging a determined struggle against those who are hell-bent on making
their lives a hell, the ones who are ruling this country for and on behalf of
the corporate elite at the cost of the people of this nation. This struggle is
not for just the farmers though. Just like how the farmers of this country sow and
reap for all of us, to feed all of us, they are now fighting on behalf of all
of us, the people of this country, whose food security is at stake, whose democratic
rights are at stake and eventually whose very survival would be at stake. That
is why the farmer’s struggle needs the support of the whole of India, every single
citizen, including you and me.
What was the motivation for the
government to rush in the new farm bills now when the whole nation is
pre-occupied in the fight against the pandemic, even flouting all democratic
norms and procedures? NITI Aayog gives
the answer. It says “The country is witnessing the accumulation of a large
surplus of grain and sugar, which is getting increasingly difficult to dispose
of in the overseas markets due to poor price competitiveness of our produce. We
need to reduce the logistics cost at least by half”. It adds, “According to the emerging
scenario of demand and supply, India will be required to sell 20–25% of the
incremental agri-food production in overseas markets in the coming years”. NITI
Aayog CEO’s worry is “As India
transitioned from a food deficit nation to a surplus one, the focus of policy
has rightly shifted to surplus management from deficit management”. So, it
becomes evident that the Government’s eye is on the profiteering opportunity of
the export-market making use of these surplus and it wants to handover the
Indian Agriculture sector to the corporate on a platter for them to leverage
and exploit the said opportunity. No wonder as many corporate companies have
mushroomed in the recent times to exploit and profit from the farmer’s toil. They
aim to reduce the cost by engaging only a few big players in the agriculture
sector and hence want to drive away all the marginal, small and medium farmers
from the field. These new farm bills target to achieve exactly that. Where
those poor farmers who eventually would get evicted from their own land because
of these so called “reforms” should go to? Well, the Government is least
concerned about that. They simply don’t care. The new farm bills are nothing
but a move to remove all the obstacles for the corporate to operate seamlessly,
unhindered and unquestioned. These acts are essentially to allay the fears of
the corporate and investors of any regulatory interference by state or anyone
else in their business operation, and give the corporate a free-hand to go
ahead with their green-conquest, a conquest that would make Indian agriculture
fields an assembly line for the agro-corporate while turning them to death
fields for the farmers.
While the bureaucrats of the NITI
Aayog talk about surplus, look at what the Global Hunger Index says. As per the GHI, India is almost at the rock
bottom of the list, having highest number of people who stay hungry. India has in recent times further fallen to an
embarrassingly low position in the list, 94th rank among 107
countries, even below the likes of Pakistan, Bangladesh and Nepal. The glaring number
says it all! It leave no room for doubt that our farmers, who are giving us
this surplus, are staying hungry! Does one need any expert economists to
suggest where that surplus must go? Isn’t it criminal to talk about surplus and
export on the face of those millions of small children who go to bed every day
empty stomach? An estimate shows 3000 children die of hunger every day in India. Isn’t it utterly shameful to know that 65 lakhs tonnes of grain went
rotten in the godowns in just four months while the people were going hungry in
these difficult times of extreme distress due to COVID pandemic? Shouldn’t
those empty stomachs be the priority of any government which has at least an
iota of sympathy towards its own people? Clearly, the priorities of those in
power lie elsewhere. Their priority is to feed the corporate, for whom they
rule, even at the cost of farmers, workers and those who are toiling day in and
day out to meet the ends. This is exactly what the ‘neo-liberal’ politics is.
NITI Aayog has spelt in no uncertain terms what the objectives of these new
farm acts are as they say “the new acts take forward the unfinished agenda of
reforms started in 1991”. No wonder the NITI CEO argues there is “too much
democracy” as it is these remaining little democratic forces in the country
that come in their way, trying to scuttle their attempts to loot this nation to
fill the coffers of a few corporate neo-rich. Farmers realise that the bell
tolls for them and the toiling poor around. The farmers do realise that they
have no option but to fight for survival lest perish.
The three farm acts are clearly an
attempt to offer the Indian Agriculture sector to the agro-corporate houses,
throwing the farmers into deep untold, unending miseries, even to the extent of
leading them to extinction. Farmers are well aware that these acts will make
their lives more miserable and hence they have joined hands to host one of the
massive people upraising against the government that India has not witnessed
for a long while. But, as said, the current
struggle is not for the sake of farmers alone. The new farm acts would impact not only
farmers, but a vast majority of people, particularly the poorer section of this
country. Our food security, our democratic rights, our country’s future are all
at stake and thus we all owe our support to farmers in this historic
struggle. The true nefarious intend,
underpinning agenda and the far-reaching implications of these acts must be
thoroughly exposed and publicised among the mass and gather widespread support
for the farmer’s struggle.
To start with, these bills are completely
undemocratic and unconstitutional, both in their content as well as the manner
in which they were made into laws. The three
new farm acts were initially brought in as ordinances in the month of June,
2020. In fact the farmers were staging protests in various parts of the country
immediately after the ordinances were brought in and the struggle has only grown
big and intense since then. New bills were brought in the parliament to replace
the earlier ordinances and were made into laws in the month of September in a
most undemocratic manner. Not only that these bills were formulated without
holding any consultations with any of the key stake holders, especially the
farmers or their organizations, the Government didn’t even allow any meaningful
debate in the parliament and instead the whole democratic process was scuttled
by suspending the opposition members, avoiding any discussion in the upper
house and opting to pass the bill by voice voting. No wonder the bills reflect
a complete lack of understanding of the ground realities of rural India and the
crucial role agriculture play in the livelihood of the people living in there. The
bills were dictated by the corporate and the government acted as a willing partner
in this crime.
The new farm acts should be objected for 3 key reasons
i) The farm acts are a total
farce on democracy and constitution and are an attack on the very federal
structure of our nation. If we go by the spirit of the constitution and the federalism
it advocates, agriculture is primarily a
state subject and it is left to individual states to form necessary acts and
guidelines that would best suit their unique needs, though some of the other provisions
mentioned in the constitution may be cited as legal justification for the union
government’s intervention in the subject. The new acts have no
place for the voice of the States and thus give scant regard to the federal
structure and principles of our constitution. The Act reads “This act will
have overriding effect on all State APMC acts” (Act1, section-14). Such
arrogance and audacity of power to simply void state powers is a grave threat
to our co-operative federalism and should not go unopposed. Another equally
important transgression into constitutional rights is how the fundamental
constitutional right of every citizen to seek legal remedies in courts is taken
away. This may be used as template in the future legislations as well, if it is
allowed to go unopposed, where our democratic constitutional right to take our
grievances to courts will be curtailed and the government will start positioning
itself as the complainant, prosecutor and the judge, all in one. Thus, the
bills must be questioned for its violation of all democratic and constitutional
norms.
ii) The acts are against the interest of the farmers. The bills would evict millions of farmers from their land and their traditional livelihood, making them jobless, and would convert Indian agriculture into a pure corporate monopoly. Our policy makers say there are too many people engaged in the agriculture sector and the numbers should be drastically reduced. What they don’t say is where the millions of displaced poor farmers should turn to for their livelihood.
iii) The acts will have far-reaching consequences affecting adversely our hard-earned agricultural self-sufficiency and most importantly, our food security. The acts will also pave way for endangering the bio-diversity and crops pattern as it would be the agro-corporate who would be in control of the agro-inputs, including the seeds and choice of crops, and would be the one deciding what to grow, when, where and who.
It is very ironical and amusing to notice how misleading the names of these acts are. In fact the names suggest desperate attempt by those involved to conceal the real intent of the bills. It is as if the label reads ‘sugar’ while the bottle is filled with ‘cyanide’!
The first two acts are named ‘Farmers’ Produce Trade and Commerce (Promotion and Facilitation) Act, 2020’ and ‘Farmers (Empowerment and Protection) Agreement of Price Assurance, Farm Services Act, 2020’. What the bills lack for farmers is exactly what are there in the titles, namely protection, empowerment, price assurance and promotion. The bills take away all the above from the farmers. The third bill read “Essential Commodity (amendment) Act 2020’ and what it does is exactly the opposite, defining the very essential foodstuffs, including the basic food items like rice, wheat, potato and onion as ‘non-essential’. So, we must strictly warn those unsuspecting ‘innocents’ who want to go by the titles and government’s hollow words not to go by the label and swallow what is there in those bottles.
India still remains predominantly an agriculture economy. Almost half of our population (42%) is engaged in farming and associated activities for their livelihood. 86% of these farmers are marginal and small-scale farmers having less than 2 acres to 5 acres of land. What this implies is that any change in the agriculture sector in our country will directly impact almost half of the population. Thus, for a huge section of our population, these farm acts are a matter of their life and death and that is why they dare all odds to wage the battle of their lives. With more than 12000 farmers resorting to suicide every year, these acts will only worsen their plight.
If we dive a little deeper into the content of these acts, we would realise how draconian and anti-farmer they are.
Act1: Farmers’ Produce Trade and Commerce (Promotion and Facilitation) Act, 2020
This act primarily lifts the existing restrictions on farmers and traders to do transactions outside the APMC Markets. Farmers will be allowed to trade their agricultural produce outside the market areas operated under various state APMC acts. This act essentially ‘bypass’ the APMC systems and override all the state-level legislations in force which regulate market for the agricultural produce in various states. Thus, the states will no more have any say on a subject that is designated as a state-subject in the constitution. The act also prohibits state governments or APMC from charging any cess, levy or any taxes at these ‘private market trade areas’, which is outside the APMC market yards. The government version is that this act gives freedom to the farmers to sell their produce wherever they want and to whomever they want. Government projects this act creating an alternate ‘free-market’ where farmers will get “freedom of choice” to trade with anyone, anywhere in India.
On the face of it, this would look like a step to help farmers to fetch higher price for their produce. However, this argument will not stand the scrutiny of anyone who has even basic understanding of how the so called ‘free-markets’ operates. In reality, the farm acts are akin to pulling away the security net provided to the farmers and in turn pushing them into the shark-infested deep waters and claiming they are being offered the ‘freedom’ to swim wherever they want. Leave alone swimming, they would only be eaten up by the sharks in there. This so called ‘freedom’ narrative is only a cover to conceal the actual intent underneath. It is like unbolting the chicken coop (hen house) on the pretext of freeing the chickens while the actual intent is to let the fox enter the coop.
The APMC trade restrictions are meant to protect farmers from exploitation rather than curtailing freedom. For a guy who earn barely 100 rupee a day, it is absurd and cruel to offer so called ‘freedom’ to dine at any of the five-star restaurants in any of the cities across India. The so called ‘freedom of choice’ in this instance means absolutely nothing for him. It is rather a mockery on his plight. What would make sense for him is to have his nearby dhaba able to offer him his daily meals with what he can afford to pay. So, this whole argument of ‘freedom to sell’ anywhere to anyone is totally bogus and a complete eyewash. If the government think majority of the farmers will have wherewithal to travel to faraway places to sell his produce, they are living in fool’s heaven removed far from the reality. But it is not that they are not aware of it. They just want to act ignorant as the actual intent is to lure the farmers away from the safety-net of APMC and make them perish so that the corporate can take over all for themselves. The farmers do realise this and they are not interested in the promise of hollow ‘freedom’. For them, the existing APMC system that has worked well despite all its limitations is what matters the most. They foresee a grave threat to the existence of APMC mandis once the new acts become operational, which will turn them helpless and leave them exposed to the potential gruesome attack by the corporate predators.
What is concealed in this misleading government narrative of “freedom of choice” is that the restriction inbuilt into the current APMC system is in fact an inherent safety net to protect farmers from being pressurised to sell their produce in distress to their lenders and other scrupulous traders and intermediaries. APMC system is essentially to protect farmers from exploitation and to ensure they get a minimum support price (MSP) for their produce. APMC (Agriculture Produce Marketing Committees) Markets or Mandis were established to enable farmers to sell their produce at a fare price and to protect them from traders, money lenders and middle-men taking away their produce for pittance. APMCs divide the states into several zones and all the farmers in a particular zone are supposed to trade their produce only in the APMC Mandis designated for them. The traders are not allowed to enter into trade outside these mandis. This restriction is to actually avoid traders coercing farmers into selling their produce at much a lower price than the minimum support price (MSP). Thus, the restrictions imposed on trades outside the APMC Mandis are in fact to ensure that the farmers are not forced to give away their produce to the traders and agents as many of these traders/agents would be the ones extending financial loans as well to these farmers. In other words, the insistence to sell only inside the APMC Mandis is not a restraint, but a mechanism to protect the farmer’s interest. The produces are auctioned in the mandis and the arhtiyas (registered commission agents) purchase the produce from the farmers on behalf of government agencies like FCI or other private traders and exporters. Arhtiyas also provide other services like cleaning, loading, packaging etc of the produce and also many of them finance the farmers. These agents are paid commission by the buyers like FCI and private traders. Mandis also charge taxes, which are used by the state Governments to improve the infrastructure and other agricultural related services. To ensure the safeguarding of farmer’s interest, the APMC Mandis impose the conditions like 1) for all the produces where the Government has announced MSPs, the products can’t be sold at a price below MSP 2) Inside all APMC regions, the farmers and traders can enter into wholesale trades only inside the designated mandis, not outside.
The new act provides to create private markets or ‘trade areas’ outside the APMC system where both these conditions are not applicable. There will be no Minimum Support Price and neither there will be any restrictions on where and whom the traders and companies can buy produce from the farmers. There would be no need to register or obtain licenses for the traders and thus any individual, groups or corporate can buy produce from the farmers. State government is prohibited to charge any cess, levies or taxes in these private markets from anyone. With the new found license and golden opportunity to force farmers to sell their produce anywhere at any price, the traders, agents and other corporate entities will desert the APMC mandis and take the trade outside and coerce farmers to submit to them through various means. This will only weaken the mandi system and will force farmers to sell their produce at much lower price at these private ‘trade areas’ as no alternative avenues will be available for them to dispose of their produce.
As we know, farming involves lot of uncertainties and risks. Between the sowing and harvesting, lot many factors may adversely impact the outcome. So, it is critical to make sure that the farmers get a reasonable income above and beyond what they have to spend to produce crops. Only then they can sustain farming and produce foodstuffs to feed the nation. Enforcement of Minimum Support Price (MSPs) on selected produces are to ensure that the farmers would get at least a minimum price to cover their cost of production. If not for MSP, traders will bring down the price at the time of harvesting and the farmers will be forced to sell at throw away prices, pushing them into huge debts. Thus, MSP is very crucial in providing support to the farmers. Telling farmers, most of who live in small houses with one or two rooms, that they could store their produce as long as they wish and sell whenever they want at the price they decide is totally unrealistic. These farmers won’t have adequate storage facilities and hence will be looking to dispose of their produce at the earliest. Moreover, the farmers will have to sell their produce immediately after the harvest to settle their loans and pay for their other living expenses, including children’s education, medical needs etc. So the agents and financiers will try to take advantage of this distress situation and will try to squeeze maximum out of the poor farmers. Eventually the farmers would be left with nothing. They would be forced to ultimately sell their land to come out of the debt trap. It is precisely to avoid this situation and save farmers from this distress sale that the APMC mandi system was introduced. The new act is destroying farmer’s life-support echo system by paving the way for dismantling the APMC mandis. Government should rather focus on expanding the APMC system and build more mandis, fixing the loopholes, than completely destroying the APMC system for all practical purposes and leaving farmers at the mercy of traders and corporate. Majority of the marginal, small and medium farmers with very little bargaining power will be pushed out of the new system and rapidly will move out of farming, which is precisely what the corporate and the government are looking for. So, this act is not an accident, but a well planned strategy to get rid of all small farmers and handover the agriculture entirely to the mega agro-corporate. Bihar provides one of the glaring example of what can be expected to happen if APMC vanishes. In Bihar where the APMC system was discontinued in 2006, farmers are forced to sell paddy for Rs.600 and 700 a quintal while the government MSP stands at Rs.1800. In fact the plight of the farmers there is so pathetic that majority of them don’t produce enough to even to take to market for trading. Many farmers have left farming forever and were forced to migrate to other states in search of daily wages and casual labour. This farm act targets to replicate the same story across the country so that the field would be left open for the corporate to play at their will and by their own rules.
The act also takes utmost care to protect corporate from having to face any legal consequences. Not only farmers, even no citizen are allowed to take their grievances to court. Corporate don’t want to be bothered with the law of the land and the government readily oblige, taking away the fundamental rights of the citizen in the process.
Section 13: “No suit, prosecution or other legal proceedings shall lie against the Central Govt or the State govt or any other person in respect of anything which is in good faith done or intended to be done under this Ordinance or of any rules or orders made thereunder”
Section 15: No civil court have jurisdiction to entertain any suit or proceedings in respect of any matter, the cognizance of which can be taken and disposed of by any authority empowered by or under this Ordinance or the rules made thereunder
Act2: Farmers (Empowerment and Protection) Agreement of Price Assurance, Farm Services Act, 2020
The second farm act is about contract farming. The act puts in place a framework for the farmers to enter into agreement with buyers and other third parties involved in advance, before they sow the crop, to sell the final produce at a pre-fixed price. It is an agreement based cultivation of pre-decided crops of pre-determined quality, quantity, grade and variety by farmers on behalf of a sponsor, who can be a trader, a corporate company or any other entity. The farmers are obligated to fulfil the contract conditions and the sponsor is liable to purchase and pay for the produce only if all the conditions, including quality, quantity and other parameters like even pesticide residue left on the grain, moisture content etc, stipulated in the agreement are met.
The act talks about two forms of agreement
Trade and commerce agreement – farmers are paid when they deliver the final produce. The buyer is not responsible for anything if the produce is not delivered. i.e the farmer will be solely responsible if their crop is damaged for some reason or the other. The entire loss will have to be born only by the farmer
2. Production agreement – The buyer will be providing ‘farm
services’, including providing seed, fertilizers, machinery and other inputs
and advice and the farmers are paid just for whatever service the farmer
provides, not necessarily the price for the produce
The contract doesn’t need to specify any minimum support price. The contract will specify though the quality and standard that should be met by the final product for the sponsor to take the delivery. The sponsor can always decline to purchase the product citing any reason like the final produce not meeting any of the terms specified in the agreement and can use it to either reject the entire lot or to lower the price considerably. Even the amount of pesticide residue on the final produce can be a reason to decline the product. With no option to seek legal remedies and absolutely no means to fight with the battery of corporate lawyers, farmers will be completely at the mercy of the corporate houses.
Clause 4(1) The parties
entering into a farming agreement may identify and require as a condition for
the performance of such agreement compliance with mutually acceptable quality,
grade and standards of a farming produce.
Clause 4(3) The quality, grade and standards for pesticide residue, food safety standards, good farming practices and labour and social development standards may also be adopted in the farming agreement
Clause 6(2) The Sponsor may, before accepting the delivery of any farming produce, inspect the quality or any other feature of such produce as specified in the farming agreement…
With farmers or anyone else not in a position to predict or control the outcome of the production, farmers will be always running the risk of their final produce getting rejected by the sponsors. If the market prices are lower than the price agreed in the contract, the sponsor can always use this clause to entirely decline to purchase or to force the farmer to sell at lower price. This farm act would lead to a situation where the sponsors, a bunch of agro-corporate companies, would start deciding what crops, when, where and how much to produce. The crop pattern could easily get aligned with the export market as that would be more attractive and profitable for the companies. With the corporate in full control of all the inputs, including the seed varieties, the entire crop pattern will undergo a shift and the bio-diversity and richness would be put severely under threat. Farmers will be forced to produce what the sponsors want and will be turned into mere contract labourers of the companies in their own land. Even none of the state laws can come to their rescue as the clause 7(1) completely exempt the commodities produced under farming agreements from all state laws.
7. (1) Where a farming agreement has been entered into in respect of any
farming produce under this Act, such produce shall be exempt from the
application of any State Act, by whatever name called, established for the
purpose of regulation of sale and purchase of such farming produce.
Is the middle-man removed by all this as claimed? Of course not. Apart from the fact that the corporate themselves become the new middlemen, it also brings in ‘aggregators’ and ‘Farm Service Providers’ as the new middlemen in the farming agreements. The clause 10 reads
10) Save as otherwise provided in this Act, an aggregator or farm service provider may become a party to the farming agreement and in such case, the role and services of such aggregator or farm service provider shall be explicitly mentioned in such farming agreement.
Thus, it is a total free-hand for the corporate to decide how they want to shape Indian agriculture so as to profit to the maximum. If these are not enough, the third act free them from the essential commodities act’s provisions as well so as to allay any fears the corporate may have about state intervention in their business.
Act3: Essential Commodities (Amendment) Act 2020
This act pretty much nullifies the Essential Commodities Act of 1955. Most of us would think foodstuffs are the most essential commodities. Strangely, our Government thinks otherwise. May be, for them, the corporate profit tops the list. The act removes the foodstuffs, including cereals like rice and wheat, pulses, potato, onion, oilseeds and edible oil etc, pretty much every single food item that we need for our day-to-day life, from the list of essential commodities. What that implies is that government neither can intervene to prevent hoarding and black-marketing of these items nor can regulate the prices of these commodities. The original act was established to ensure the availability of commodities that are essential for us to lead a normal life and to be vigilant against hoarding and black marketing and deliberate obstruction of the supply of these essential products. In effect, the new act is making hoarding and black-marketing legal for the corporate. The act severely restraints government from exercising any control over hoarders. Government is not allowed to impose any stock holding limits for these newly delisted produces, except for extreme exceptions like war, famine etc. The method of calculating ‘extreme price rise’ is a joke. Corporate can keep increasing the price as long as they make sure the moving average of the price over 12 months remains just below 50%. Another strange rider is that even these limited criteria cannot be applied if “the stock limit doesn’t exceed the overall ceiling of installed capacity of processing or the demand for export in case of an exporter”. So, if the company has huge warehouses, they can stock as much they want even if the price skyrocket! Government takes extreme care to make sure that the operation of private businesses and corporate do not face any difficulties from anyone, including government agencies, judiciary or citizens in their quest for profit. The act will be a huge threat to the food security of the country and will kill the already weakened PDS system as the State governments will have to now beg the corporate for grains and other foodstuffs to distribute through the PDS outlets for the poor. Instead of strengthening the essential commodities act and PDS systems to ensure availability of most essential stuffs like food to all, the Government is encouraging the corporate to profit from even people’s hunger. At a time when people are unemployed and hardly have any purchasing power, subjecting them to food price inflation is simply an unpardonable crime against humanity.
Eyeing the new found opportunity and Government’s willingness to even sell India to appropriate wealth for a few elites, dozens of ago-corporate entities have mushroomed in the last couple of years. More than fifty agro companies have been registered in the last two years by the likes of reliance, adani, patanjali etc. These corporate are now going to decide what Indians should eat and even how much they should eat as a greater share of agriculture produce may be set aside for export. Government is going all-out to ensure a free-hand for the domestic and foreign corporate to have a field day with the newly opened up agriculture sector. Those in power with no concern whatsoever for the poor may use any crude tactics to realise their agenda. For example, the laws banning cattle sale evoking the religious sentiments of ‘gau-matha’ and ‘love for cows’ was nothing but a condemnable move to drive away local people from cattle-rearing so that the corporate could establish its monopoly on the dairy produce market. The label was ‘gau-matha’, but the real content was ‘corporate pitha’! The government forces engaged in mass campaigning to mislead the innocent unsuspecting minds to flock behind the ‘gau-matha’, while they struck a back-door deal with the corporate.
It is not only domestic conglomerates like Ambanis, but foreign corporate like walmart, kargil etc are also eyeing the Indian agriculture sector to get their share of the pie where they can ensure more export from India at a much higher profit by paying as cheap as possible to the farmers, especially now that the MSP is out of the picture. The unregulated and unlimited export of food grains will lead to massive food shortage and crisis with rampant hoarding and black-marketing and the eventual victims would be poor farmers and the disposed majority of this country. Ultimately it is the life of the poor, who hardly own any equity in the nation’s wealth, which is going to be more miserable. Therefore, it is important to educate the people about the threat posed by these new farm acts to their livelihood and their future in order to evoke wide-spread mass support for the historic struggle being led by the farmers. A strong and relentless people resistance alone can force the government to repeal the new farm acts that are anti-farmer, anti-people and anti-nation.
- Suresh Kodoor
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