Prime Minister Narendra Modi on Monday called the two farm bills passed by Parliament on Sunday “historic”, addressed key concerns around each of the three bills that seek to liberalise agricultural trade in the country and criticised opponents for “misleading” farmers even as Opposition parties slammed the government for hurriedly passing the legislations.
Modi spoke on how each of the three bills bought by his government would help farmers in multiple ways, seeking to dispel “misinformation” being spread around them while unveiling new projects in poll-bound Bihar through a video address.
The Farmers’ Produce Trade and Commerce (Promotion and Facilitation) Bill, 2020, passed on Sunday, aims to ease all restrictions on trade of agriculture produce.
The Farmers (Empowerment and Protection) Agreement on Price Assurance and Farm Services Bill, 2020, also passed on Sunday, lays down a new architecture for contract farming in the country to ensure farmers can engage with one another more confidently, enable modern supply chains and investments by agribusinesses.
In a speech aimed at putting a lid on concerns of farmers’ groups, Modi said the existing agricultural state-regulated mandis — also known as agricultural produce market committees or APMCs — would continue to function. He also said the government would continue to buy farm produce at minimum support prices (MSPs).
“APMCs will not shut down. The new laws are not against mandis and I also want to assure the country that the government will continue to buy farm produce at MSPs in every (farm marketing) season,” Modi said.
The PM said the National Democratic Alliance (NDA) government had strengthened the APMC system. “Every market has been computerised,” he said.
To allay fears over an alleged weakening of the MSP mechanism, Modi said: “MSPs will continue like before. The proof for our commitment to MSP will come from a comparison of prices paid by our government with that of previous regimes.”
MSPs are federally fixed statutory prices, mainly for rice and wheat, at which the government buys from farmers.
“Our government has purchased 24% more oilseeds and pulses at MSPs. Even when the country was under the lockdown because of the coronavirus disease (Covid-19) pandemic, there was record wheat procurement. The procurement of wheat, oilseeds and pulses was 30% more and farmers were paid a total of Rs 1,13,000 crore in MSPs,” Modi said.
The new set of laws brought by the government allows direct purchase of produce from farmers outside APMCs. APMCs have enjoyed a monopoly in farm produce trade so far and there is evidence that trader cartels have often manipulated wholesale prices to the disadvantage of farmers and consumers.
In December 2010, when onion prices peaked, a probe by the country’s statutory anti-monopoly body, the Competition Commission of India (CCI), had revealed that one firm accounted for nearly a fifth of the total onion trade for that month at Lasalgaon APMC, Asia’s largest onion market in Maharashtra’s Nashik.
Modi said farm produce would travel freely across states and farmers were already reaping benefits of open markets to get higher prices.
“Ground reports tell us how the reforms have benefited farmers,” Modi said.
In Bihar, traders bought potatoes directly from farmers for storage in cold chains at higher prices, the PM said. In Madhya Pradesh (MP), oil processing mills bought oilseeds from farmers paying between 20% and 30% more in June and July, he said.
Modi said growers of pulses would get better prices in states such as Uttar Pradesh (UP), Chhattisgarh and West Bengal because of the freedom to directly sell to traders.
Farmer organisations, such as the umbrella outfit, the All India Kisan Sangharsh Coordination Committee, said they would continue to protest these reforms, as the government passed them without adequate consultations, farm leader VM Singh said.
The bills were passed amid stiff opposition in the Upper House and an ensuing chaos during a voice vote, which opposition parties said was unfair and unsound. The opposition said the deputy chairman of Rajya Sabha, Harivansh, did not allow detailed voting on the bills, called “division”.