The Farm Bills: An Analysis

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Written by: Ms Devshree Dangi

Farmers are the base of every nation. They work hard and feed us. The government of India has always been tried it’s best to improve the agricultural laws so that the farmers will get the price they deserve for their produce.

Recently, three farm bills have been passed by both houses of Parliament and President of India, Shri Ram Nath Kovind gave his assent to these bills on 27th day of September 2020.

After these bills were introduced, they were criticized by a large number of farmers and politicians in India. Even a long term BJP Ally Shiromani Akalidal called these bills as “Anti Farmer Bills”.

Those three bills were “Farmer’s Produce Trade and Commerce ( Promotion and facilitation) Act, 2020, The Farmer’s (Empowerment and Protection) Agreement on Price Assurance and Farm Service Act, 2020, The Essential Commodities (amend) Act, 2020.

These three bills talk about the contract farming, freedom of farmers to sale their produce outside the Mandis and removal of certain things from the essential commodity Act with an aim to provide better price to the farmers for their produce.

The main provisions of Farmer’s Produce Trade and Commerce (Promotion and Facilitation) Act, 2020;

  • ​This Farm bill has an objective to create a system where the farmers and traders can freely produce, sale and purchase.
  • ​According to this bill, there will be barrier-free interstate and Intra State trade and Commerce even outside the physical premises of markets notified under state agricultural produce marketing legislation.
  • ​As per the provisions of this bill, farmers will not be charged any cess or levy on their products and they won’t have to bear transport costs.
  • ​The farmers have the freedom to trade at farm gate, cold storage,  warehouse, processing units other than Mandis.

Now the thing is that on a part it cannot be said that these laws are good. There are some questions and doubts raised by the farmers and politicians around the nation that will the MSP system end after the enforcement of these laws? Will the Mandis stop functioning after the enforcement of these laws?

The Government of India has already given an explanation over these questions. The government of India said the system of MSP will remain in force. The farmers are free to sale their produce at MSP as well.

The Government of India further said that the Mandis will remain open and will not stop functioning. The farmers can trade-in Mandis also. And now as per the provision of this act, the farmers have a choice either to sell their produce in Mandis or anywhere they want.

Main provisions of The Farmer’s (Empowerment and Protection) Agreement on Price Assurance and Farm Service Act, 2020;

  • ​This Act has brought an aim to empower the farmers to engage with processors, wholesalers, aggregators, large retailers, exporters etc. on a level playing field.
  • ​As per the provisions of this act, the farmers are now allowed to form contract even before sowing of crops. It gives price assurance to farmers even before the sowing of crops. This act further provides that the farmers are entitled to more price over and above the minimum price in case of the higher market price.
  • ​According to this act, in case of a dispute between a farmer and the other party to contract, there is an effective dispute resolution mechanism with clear timelines for Redressal.

The Government of India has brought this law with an aim to improve the income of farmers. The farmers around the nation objected over this law and said it will lead to the exploitation of farmers. Big companies and well-settled traders will take advantage of farmers who has less knowledge of contracts and laws related to it.

The Government of India has given explanation over this and said that the farmers will have full power in contract to fix a sale price as per his choice. And the farmers will receive their payments within a maximum of 3 days.

The Government of India has further said that there are 10,000 Farmer’s Protection Organizations those will bring together the small farmers and work to ensure remunerative pricing for farm produce.

The Government of India explained that the farmers will not have to seek out traders after signing the contract, the consumer will pick up the product directly from the farm.

The main concern of the farmers was that they have been deprived of approaching the courts in case of any dispute.

The Government of India said there will be an effective Local Dispute Redressal mechanism for such disputes. This will help them out to get quick solutions and Justice.

Main provisions of The Essential Commodities (amend) Act, 2020;

  • ​As per the amendment to this Act, it has provisions to remove Commodities like cereals, pulses, oilseeds, edible oils, onion and potatoes from the list of essential commodity.
  • ​It was also mentioned in the amendment that in situations such as war, famine, extraordinary price rise and natural calamity the imposition of stock holding limit is allowed.
  • The amendment to this act will help the private investors of excessive regulatory interference in their business operations.

There will be a freedom to produce, hold, move, distribute and supply will lead to attracting private sectors and Foreign Direct investment into the agricultural sector. It will lead to the modernization of the food supply chain.

Now the Government of India has done its part. It has made the law well defined and Clear. Now if it is seen from the government’s side, then it seems that all these laws are in the interest of farmers and farmers will surely get benefit out of it. But if it is seen at the part of farmers there will be a question mark. Because in the end, the farmers will have to bear everything.

The laws are really good but the reality is a far different than the Government’s imagination. The farmers are not aware of the contract laws. Now in this situation how will they be handling the E contracts?

There is nothing new that the Government of India has taken efforts to make the agricultural reforms successful. There are certain laws that have already been introduced and are almost similar to the recent laws introduced by the Government. Earlier the Government of India took an initiative with the same objective in the year 2017.

The Act that introduced by the Government of India was “Agricultural Produce Livestock Marketing (promo and facilitating) Act, 2017. The bill was introduced with an aim to double the income of farmers by 2022 and significant changes in fixation of MSP. And now the Government of India has introduced these three bills that are now in enforcement.

The point is will the formers get guidance for such things. Nor the Government neither the farmers are wrong at their part. The only thing that required is proper education to the farmers. Because when the farmers aware will be aware of what this law actually says they will never get exploited by anyone.

The Government should assure the farmers that it will practically implement these laws and educate farmers so that the farmers will get the actual benefit out of these laws.


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