The defeat of hubris, a confrontation on hold

Context: Addition of local agrarian demands into the call for the repeal of the farm laws may have forced the Government to repeal controversial three farm laws.

Background: Basics of farm laws

• Diversify cropping pattern into export-oriented and high-value crops, mandis need to give way to private markets, futures markets and contract farming.
• Amendment to Agricultural Produce Market Committee (APMC) Acts: So that any private market or rural collection centre can freely emerge anywhere without approval of local mandi or payment of a mandi tax.
• APMC Acts discriminated against farmers by not allowing them to interact directly with big corporate buyers and exporters.
• Amendment to the Essential Commodities Act, 1955 so that private corporate investment can be incentivised into storage and warehousing if stock limits are relaxed for traders.

Issues associated with farm laws

• Dismantle the institutional support structures in Indian agriculture: That were instrumental in India’s achievement of food self-sufficiency between the 1960s and the 1980s.Like
  • Support structures in prices, subsidies, credit, marketing, research and extension.
• Laws were unconstitutional as it violated  federal principle: As, the Union government invoked Entry 33 of the Concurrent List to intervene into matters in Entry 14, Entry 26 and Entry 27 of the State List.
  • The farm laws even interfered with Entry 28 of the State List, which were not subject to Entry 33 of the Concurrent List.
  • Passage of law was violation of long-held constitutional consensus in India that agricultural marketing was the legislative arena of State governments.
• Centralised approach to reforms in agriculture without considering local factor: Model Acts on agricultural marketing by central government’s reception was neither dismissive nor welcoming.
• Reliance on private investments for agri reforms: But various examples show that, private investment was unlikely to flow into agricultural markets even if APMC Acts were annulled.
  • Bihar completely annul its APMC Act in 2006, after that, exploitation of farmers by unscrupulous traders intensified in Bihar.
  • Kerala never had an APMC Act. Yet, there was little presence of private investment in its agricultural markets.
  • Maharashtra has marginal inflow of private investment into agricultural markets, even after delisting fruits and vegetables from the ambit of APMCs in 2016. 
• Weakening of APMC Acts might fragment formal and regulated market into an informal and unregulated market.
• Unable to address structural problem of agriculture: Like substitution of investments in mandi from mandi taxes, and poor farm-gate aggregation of the produce of small and marginal farmers.
• Weak grievance redressal mechanisms for contract farming.
• Apprehension that farm laws benefitted corporates instead of farmers: As, overall thrust of the farm laws appeared to encourage the participation of larger corporate players in agricultural markets rather than farmer-friendly organisations, such as cooperatives or Farmer Producer Companies (FPC).

Way forward

• Stable agriculture markets and remunerative prices for agri produce.
• Positive politicisation of several agrarian demands through committed struggles:  Need for new rural mobilisations around demands to address the larger and persistent agrarian crisis.

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