Parliament Passes Contentious Agricultural Bills For Inter-State Trade, Contract Farming [Read Bills]

The Parliament today cleared the Farmers' Produce Trade and Commerce (Promotion and Facilitation) Bill, 2020 and the Farmers (Empowerment and Protection) Agreement on Price Assurance and Farm Services Bill, 2020, by voice vote. The Bills have set off widespread farmers' protests who fear that shall not be paid the Minimum Support Price. However, both the Agriculture Minister and the Prime Minister have assured that the Bills do not affect the mandate of MSP. The Bills, already in force as Ordinances, were passed in the Rajya Sabha on September 17, 2020 and cleared today by the Lok Sabha, however amid utter chaos and opposition. They seek to facilitate intra-state and inter-state trade of farmers' produce and execution of agreements between farmers and buyers, prior to the production/ rearing of any farm produce. Parliamentary Debate The Bills were widely opposed in the Upper House for their potential of abuse by the private sector, leading to further exploitation of the farmers. With respect to Bill for 'Contract Farming', the Members apprehend that the Private sector may 'bulldoze' the farmers into entering unfair contracts, for prices below MSP. They asked the Government why the farmers were not getting 'Remunerative prices' and why the Bill did not guarantee a Minimum Support Price. Significantly, farmers have been protesting across the country, fearing that they will not be paid Minimum Support Price (MSP). However, Agriculture Minister Narendra Singh Tomar has clarified that these bills would not have any impact on the MSP mechanism, which would continue as it is. The Prime Minister has also addressed the farmers and assured that MSP shall not be abolished. During the debate, it was highlighted that in case of non-performance of Contract by the private sector, farmers shall be susceptible to prolonged litigation against big corporates, having deep pockets. Other key issues raised during the debate are listed thus: Parliament is not competent to enact a legislation on the subject of Agriculture since it falls under the State List at Entry No. 14 under Schedule VII of the Indian Constitution. Bills have the effect of privatizing the agricultural sector which will be detrimental to the farmers' interest in the long run; privatization invites black marketing, hoarding and profiteering. Bills will not help to cut down middlemen as they will continue to operate in the form of 'sponsors' for Contract Farming. Bill allows farmers to trade all over the country but there is no provision to bring buyers in the market (amid a dying economy). Farmers have minimal bargaining power and there's a massive potential for exploitation by powerful, profit-oriented private sector companies. By de-regularizing the agricultural sector, the Bill diminishes state control which not only affects the state Government's revenue but also renders them incapable to regulate in case the private sector resorts to unscrupulous practices. The Dispute Resolution mechanism proposed by the Bills is very discriminatory towards the farmers. A member highlighted that whereas the farmers have been given only a 30 days window to file their appeals before the Appellate Authority, the Companies get 60 days. Responding to the debate, Tomar assured that the legislations will benefit the farmers by increasing competition among traders, thereby enabling them to bargain at a higher price. Further, the farmers shall have an elaborate market as they will be able to trade freely anywhere in the country. On involvement of private sector in agriculture, the Minister said that it shall enhance farming as farmers will gain access to better infrastructure and modernised services. He said that the bill will ensure that many services will reach small farmers. So far as the Dispute Resolution mechanism is concerned, he explained that the Sub-Divisional Magistrate will ask both the parties in dispute to appoint two panch each who try to reach a solution. However, in case the dispute is not resolved. The SDM will resolve the issue himself. He further said that in case the matter goes to the court and an unfavourable order is passed against the farmer, then he shall be liable to pay only the actual disputed amount and that his land/ property shall not be attached. Tomar also added that the contracts signed under this law will also have a provision that if prices at time of sale are more than what was agreed to at the time of contract, then the farmers will get a certain percentage of the additional profit. Farmers' Produce Trade and Commerce (Promotion and Facilitation) Bill, 2020 This Bill permits sale and purchase of farmers' produce at remunerative prices through 'competitive alternative trading channels' to promote efficient, transparent and ...

Parliament Passes Contentious Agricultural Bills For Inter-State Trade, Contract Farming [Read Bills]

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Parliament Passes Contentious Agricultural Bills For Inter-State Trade, Contract Farming [Read Bills]

Akshita Saxena

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INR 1099+GST

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