Context: The surprise withdrawal of three farm laws can increase uncertainty and affect the overall reforms process.

Issues faced by government in Farm laws 

• Outdated guaranteed price system: There is no dispute that farmers need to be fairly compensated for their produce but any form of guaranteed price is not the way forward for a variety of reasons.
• Non sustainable: The non-sustainable cropping pattern in states such as Punjab and Haryana, which a guaranteed MSP will further encourage.
• Continuing ecological Impact: The unabated pumping of groundwater supported by subsidised power has led to irreversible damage to the ecology of these states.
• Demands of agitating farmers: They are demanding a firm guarantee on minimum support price (MSP) and the withdrawal of the Electricity Amendment Bill. They are also pressing for a legal guarantee.
• Distrust among stakeholders: The farm laws were first introduced as Ordinances in June 2020 and were later passed by Parliament without addressing all the concerns.

Way Forward

• Collective consensus: Since agriculture is a sensitive area and a source of livelihood for a large proportion of the population, the government should have spent more time building a consensus and explaining the intent to the farming community.
• Lead change: A lot of new farm laws intended to promote is already happening in several states and therefore it should be passed on to the states to decide.
• Combination of interventions: It should be adopted in terms of providing remunerative prices.
• Continued public sector procurement could be one part of it.
• Government can also compensate farmers for lower realisation.
• Encourage cooperatives of farmers: To participate in the value chain and government will have to constantly engage with farmers to push reforms and improve productivity in the sector.

Conclusion: At a broader policy level, the chain of events in the context of the farm laws has dented India’s policy credibility and should have been avoided.

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