Explained: The 3 Farmers Bills And The Controversies Surrounding Them

Farmers in many states are protesting against three recent bills passed by the Parliament.The controversy pertains to : 'Farmers' Produce Trade and Commerce (Promotion and Facilitation) Bill, 2020' Farmers (Empowerment and Protection) Agreement of Price Assurance and Farm Services Bill, 2020' andEssential Commodities(Amendment) Bill 2020.A high-voltage drama took place in the Rajya Sabha during the passage of the first two bills, with the opposition crying foul over the Deputy Chairman proceeding to clear the bills via voice vote, turning down their demand for division on votes. The ensuing ruckus resulted in the suspension of 8 opposition MPs. Smt. Harsimrat Kaur Badal of NDA's ally SAD resigned as the Union Cabinet Minister of Food Processing Industries citing differences over the bills. The Essential Commodities Amendment Bill was passed by the upper-house on September 22, without the presence of the opposition members.Here is a brief explainer about some of the key provisions of these laws and the controversies surrounding them.Farmers' Produce Trade and Commerce (Promotion and Facilitation) Bill, 2020In simple terms, this Bill seeks to permit the sale of agricultural produces outside the markets(mandis) regulated by the Agricultural Produce Marketing Committees(APMCs) constituted by different state legislations.Many states have passed laws to mandate agricultural trade only through APMCs with the aim of protecting farmers from exploitation and to ensure fair prices for the produces. The Bill seeks to eliminate such restrictions.As per its Statement of Objects and Reasons, the regulatory framework of APMC laws "hindered the freedom of choice-based marketing and also the inflow of investment in the development of alternative markets and marketing infrastructure".The definition of 'trade area' as per Clause 2(m) of the Bill specifically excludes "market yards, sub-market yards and market sub-yards managed and run by the market committees formed under each state APMC (Agricultural Produce Market Committee) Act" and "private market yards, private market sub-yards,direct marketing collection centres, and private farmer-consumer market yards managed by persons holding licenses or any warehouses, silos, cold storages or other structures notified as markets or deemed markets under each State APMC Act in force in India"."Trade area" means any area or location, place of production, collection and aggregation including (a) farm gates; (b) factory premises; (c) warehouses; (d) silos; (e) cold storages; or (f) any other structures or places, from where trade of farmers' produce may be undertaken in the territory of India.The Bill also permits electronic trading of scheduled farmers' produce in the specified trade area.To give effect to the same, following entities may establish and operate an electronic trading and transaction platform:companiespartnership firms registered societies (having PAN) farmer producer organisation agricultural cooperative societyThe Bill, through Clauses 3 & 4, gives freedom to the farmer to indulge in intra-state or inter-state trade in areas outside the APMC mandis.It also prohibits the collection of any market fee or cess under the state APMC Acts with respect to such trade outside the APMC market yards(Clause 6).A key provision of the Bill is Clause 14, which gives it an overriding effect over the inconsistent provisions of the State APMC Acts. Also, the Central Government has been given powers to frame rules and regulations under the Act.Thus, an intention to centralize and homogenize the regulations relating to agricultural trade is evident.In this regard, it may be noted that all states do not have the APMC system. Bihar had abolished it in 2006. Kerala, Manipur, Andman & Nicobar Islands, Lakshwadeep Islands, Dadar & Nagar Haveli and Daman & Diu do not have Agricultural Produce Market Committee (APMC) Act. While Sikkim does have APMC Act but is not implemented.Also, many states such as Andhra Pradesh, Arunachal Pradesh, Assam, Gujarat, Goa, Himachal Pradesh, Karnataka, Maharashtra, Mizoram ,Nagaland, Odisha,Rajasthan, Sikkim, Tripura, Punjab, UT of Chandigarh, Jharkhand, Uttarakhand, Uttar Pradesh etc., have brought in various amendments to APMC laws at different stages to allow private markets, e-trading, contract-farming etc.Farmers (Empowerment and Protection) Agreement on Price Assurance and Farm Services Bill, 2020This Bill intends to provide for contract-farming.As per its preamble, it seeks to provide for a "national framework on farming agreements that 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'".Clause 3 of the Bill states that a farmer may enter into a written farming agreement in respect of any farming produce. The bill seeks to fix some terms of such an agreeement as follows :Minimum period of agreement: one crop ...

Explained: The 3 Farmers Bills And The Controversies Surrounding Them

LiveLaw Research Team

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