Even as Delhiites continue to suffer from a thick smog, Punjab farmers continue to burn their rice crop residue. This despite the Punjab Government banning stubble burning, appointing 8,000 nodal officers to douse the blaze and deploying over 70,000 extra machines for residue management. In fact, stubble burning cases have been the highest this year in Punjab as compared to the previous three years. So, why do the farmers seem indifferent? The fact is they are in a fix. Already overburdened, the present problem of a short gap between harvesting and sowing two different crops was thrust upon them by well-meaning environmentalists crying hoarse over the need for water conservation. So, now they have to remove the paddy straw instead of letting it lie and decompose. If they wish to remove stubble manually, they will need at least Rs 6,000-7,000 per acre. This is economically unviable for small and marginal farmers. Even if an equipment like the happy seeder is given to them to cut the stubble and sow wheat seeds simultaneously at a subsidised rate by the State Government, the additional per acre cost of rent and diesel needed to run these machines means this option is also uneconomical. Then there is the issue of low germination of wheat seeds sown with happy seeders, something our farmers cannot afford.

But a solution has to be found which is viable for everyone. A united and shared approach may yet solve matters as envisaged in the just declared commission on air management provided there is political will. State Governments of Punjab, Haryana and Uttar Pradesh could buy the rice straw from the farmers and then sell it to biomass factories, power plants, paper mills and cardboard factories. Then there is the paddy straw chopper-cum-spreader which can be operated by a tractor with 45-50 HP or more. It will not only chop the straw and spread it in the field, thus maintaining the fertility of the soil, but ease sowing of the next crop too. Plus, the accelerated straw decomposition process or Pusa capsule developed by the Indian Agricultural Research Institute is something that can be looked at as it costs less than Rs 1,000 per acre and is good for increasing nutrients in the soil. Converting stubble into biochar is another option. All stakeholders have to come together in mission mode. Simply coming down on the growers will not help.

The enactment of the three farm laws by the Central Government has triggered agitations by farmers’ organisations and a spate of counters, specially from non-NDA ruled States. Their main worry is that growers won’t get the  Minimum Support Price (MSP) on sales made outside the Agricultural Produce Market Committee (APMC)  mandis (markets). All this, when it is well-known that under the APMC, agriculturists are already getting a raw deal.  The constitutional validity of the farm laws has been challenged in the Supreme Court, too, with the Chhattisgarh Government arguing that these have in effect repealed the State law on the mandi system. It will be some time before the matter is adjudicated by the top court. The fact remains that with multiple selling options available under the new Central laws, growers will definitely be much better off. Instead of trying to undo what the Centre has done, the States should focus on how APMC mandis can do better.

The most strident criticism of the laws is based on a belief that big food companies, who now get to buy directly from agriculturists outside the designated APMCs — courtesy, the Farmers’ Produce Trade and Commerce (Promotion and Facilitation) Act, 2020 — will use their power to deny growers, particularly small and marginal ones, the MSP for their produce. In fact, an amendment passed by Punjab says that the sale of its cash crops, wheat and paddy, will be valid only if the seller pays a price equal to or greater than the MSP announced by the Central Government and that any violation would be punishable.

Before jumping the gun and speculating over what the farmers won’t get, we need to introspect as to what they are getting under the existing dispensation. At present, they are required to bring their produce to the mandi notified by the State Governments under their respective APMC Acts. Growers can’t take their produce to any other place (if any farmer does this, s/he runs the risk of the vehicle being impounded by the State agencies for violating the extant law). If a buyer is willing to pick the produce up from the farmers’ doorstep, even that is not possible.

On reaching the designated mandi, the agriculturist is confronted with two major players, namely arhtiyas or commission agents and licenced traders or buyers. The main function of the arhtiyas is to arrange for the auction and delivery of the harvested crop to the buyers. He gets a commission at the rate of 2.5 per cent of the purchase price and this has to be borne by the buyer. In addition, the latter has to pay other charges levied by the State Government (for instance, Punjab levies market fee at the rate of three per cent and rural development cess or RDC at three per cent).       

In cases where the licenced trader is a State agency, such as the Food Corporation of India (FCI), which purchases grain for meeting the requirements of the Public Distribution System (PDS) and giving them to beneficiaries at a subsidised price, the farmer is assured of the MSP. But State agencies don’t buy all of the produce brought by growers to the mandi for sale. Even for wheat and paddy, where the agencies have a well-entrenched network, the purchase is only about 33 per cent of the total produce. For others (the Centre notifies MSPs for 22 agri-items), this is much less.

The agriculturists, who are not fortunate to sell their produce to State agencies (these are predominantly small and marginal growers), are left at the mercy of the arhtiyas and licenced traders and are forced to dump it at a price substantially below the MSP. Arhtiyas exploit farmers in other ways, too. They lend money for buying agricultural inputs, namely seeds, fertilisers, pesticides and so on (in many cases, for weddings, medical emergencies, too). The interest charged is a minimum 1.5 per cent a month. That leads to mounting debt for farmers.     

According to a study on Indebtedness Among Farmers and Agricultural Labourers in Rural Punjab, as many as 86 per cent of farmers and 80 per cent of agricultural labour households are mired in debt. Over a fifth of that debt was owed to commission agents and moneylenders. What’s more, the debt burden gets worse down the scale. It’s the heaviest among marginal and small farmers. 

The conditions of millions of small and marginal growers could not have been worse than what it is today. And this has to do fundamentally with the absence of alternative options to sell their produce.

The extant arrangements are being used by States to bolster their coffers (for instance, Punjab garners about Rs 1,750 crore annually from levy of RDC at the rate of three per cent) at the cost of the Centre. This is because the levies increase the cost of food procurement for distribution under the National Food Security Act, 2013, which increases the food subsidy. It is a typical case of States gaining access to Central funds outside the award of the Finance Commission (whether one likes or not, the taxpayers’ money is also used up for adding to the riches of arhtiyas as their commission too, is coming out of the food subsidy).        

The Central law on trade and commerce opens up a world of opportunities to the farmers even while keeping the APMC intact. They can go to a private market for selling; they can enter into a contract for selling to a company (processor, aggregator, large retailer, exporter and so on) at their doorsteps, form farmer producers’ organisations (FPO) and sell under their umbrella. To worry about whether they will get MSP on all such sales, that too when at present they are literally getting nothing, is flawed thinking. By all means, they must be protected from exploitative corporations. That doesn’t mean they should be denied access to them though.

In August, 2018, among the several amendments approved by the then Devendra Fadnavis Government to the Maharashtra Agricultural Produce Marketing (Development and Regulation) Act, 1963, a provision related to making purchase of farm commodity below the official MSP a punishable offence. With this, if a private trader buys farmers’ produce at a price lower than the MSP, he could be jailed for one year, and will have to pay a fine of Rs 50,000. This led to widespread consternation and had to be dropped. 

Even so, the Farmers (Empowerment and Protection) Agreement on Price Assurance and Farm Services Act, 2020 on contract farming has provisions to protect the interests of farmers. For instance, the grower can walk away from the contract anytime but the company can’t. It protects the minimum guaranteed price in the event of a drastic fall in the open market rate, even as the agriculturist gets a share of the post-contract price surge after a contract farming agreement is signed.  To give a fillip to development of parallel markets, the Central law has also disallowed State levies (market fee, RDC and so on) on transactions outside the APMC platform. While, on one hand, this move will reduce the cost of food to consumers, on the other, it will lessen the burden of food subsidy. Instead of re-introducing these levies, the States will do well to abolish these on purchases made at APMC mandis as well.     

Complementing the other two legislations, the Centre has also enacted, the Essential Commodities (Amendment) Act, 2020 to exclude pulses, cereals, edible oil, oil seeds, onions and potatoes from the purview of this archaic law. This will free the processors, millers, exporters and so on from stock limits and other shackles and help them do their business in a seamless manner. However, the exceptions (imposition of stock limits in situations of sudden spike in price like in the case of onions right now) should be sparingly used as it gives the wrong signal, particularly in export markets, and will eventually boomerang on farmers.  

Giving more options to farmers to sell their produce can’t be stalled just because the potential buyers won’t give them MSP. Instead of opposing reform that promises something distinctly better than what the farmers are getting today, the States need to work to make their mandis efficient and healthy. Both APMC and non-APMC markets giving competition to each other is the best foot forward for ensuring a fair deal to farmers.

(The writer is a policy analyst)

Thanks to our Prime Minister Narendra Modi for taking revolutionary steps to improve the agriculture sector and to provide new opportunities to farmers for their prosperity. The farmers got freedom from many legal restrictions and we have moved strongly towards the Prime Minister’s determination to double their income.

These reforms were needed for a long time, but despite hollow promises, the previous Governments could not muster courage to implement them.

Today, those who have questioned the reformative efforts of the Government should be asked why they could not take any major and important decision in the interest of farmers even after ruling the country for six decades. Was their political compulsion behind this or some other reasons?

Efforts are being made to create an atmosphere of confusion in the country regarding the minimum support price (MSP). The canard of discontinuation of procurement by the Government at the MSP is being instilled in the minds of the uninformed people.

Also, it is being said the farmers will have no option but to sell their produce outside the market at less than the MSP. First of all, I would like to correct the misinformation. We have clarified many times that the MSP declaration will continue and the Government procurement on the MSP will continue in the future. The MSP or procurement at MSP has nothing to do with the new legislation. Those who question the Government regarding the MSP should know that only after the formation of the NDA Government under the leadership of Modi, the MSP is being determined by adding at least fifty per cent profit to the cost the produce, as per the recommendations of the Swaminathan Committee.  The Government of India declares the MSP of 22 crops.

One of the biggest outcomes of agricultural reforms in the country is that for the first time after Independence, farmers have got freedom from the clutches of middlemen. Till now the farmers were obliged to sell their produce in mandi and only about 30,000 to 40,000 licensed traders doing business in the mandis across the country used to fix the prices of the produce.

Through the Farmers’ Produce Trade and Commerce (Promotion and Facilitation) Act, 2020, farmers have not only got freedom to sell produce anywhere, but in today’s technological era, a more convenient mechanism has been created to sell produce through e-trading.  Through this agrarian reform, the farmers can also earn more profit on their produce by saving tax and transportation costs. 

The question is being raised again and again that the new provisions will abolish the Agricultural Produce Market Committees (APMC). Here again, I want to make it clear that the APMC mandis will continue to work. The only difference is now farmers have freedom to sell their produce outside mandis also. These amendments will also provide an opportunity to the mandis to develop their infrastructure and farmers will get more facilities.

Similarly, the Farmers (Empowerment and Protection) Agreement on Price Assurance and Farm Services Act, 2020 aims to connect farmers directly with traders, companies, processing units and exporters.  The farmers will get remunerative prices in every circumstances as the price of their produce is fixed before the sowing through the agricultural agreement. 

Here, I would also like to clarify that the farmers will get additional benefits under the terms of the agreement along with the minimum price. The confusion is being spread that the land of the farmers will be handed over to the industrialists and traders. On the contrary, the truth is that in contract farming, there will be agreement between a farmer and a businessman to assure the price of produce at least at MSP.  There is no issue of land in this case. No trader can take loan on a farmer’s land nor can any recovery be made against the farmer’s land. This law protects the interests of farmers in a much better way than the existing contract farming act of the States.

Provision has been made to make payment of produce to the farmers within three days of sale. Simultaneously, it has also been provisioned to settle the dispute at the local level within 30 days to preclude court cases. With this step of the Government, farmers will be protected against the risk of price fluctuations in the market due to fixation of the price of the produce before sowing. Along with this, farmers will be able to access state-of-the-art technology, advanced manure, seeds and equipment.

Under the Essential Commodities (Amendment) Act 2020, a provision has been made to remove grains, pulses, oilseeds, onions, potatoes, etc, from the list of essential commodities. This will increase the capacity of storage and processing and farmers can sell their crops in the market at a reasonable price.

Till now farmers have been worried about the loss of perishable crops like potato and onion. With the new provisions, the farmers will be able to grow these crops with more confidence. The canard is being spread here that hoarding will increase and traders will earn profits by selling products at inflated rate. This apprehension is unfounded; the Government has retained control of the stock limit as before on increasing the price beyond a limit.

Disagreement in politics is the right of the Opposition but for that, one should not play with future of the farmers. Those swayed by the cry of the Opposition against the revolutionary farm laws should verify facts and read the manifesto of the Congress in the 2019 Lok Sabha elections that promised to abolish the mandi Act and remove ban on export and inter-State trade in agricultural produce.

In the same manifesto, they had promised to establish farmers’ markets in big villages and towns to provide freedom to farmers to sell their produce. In the same manifesto, the assurance of amendment in the Essential Commodities Act was made. When the same issues are covered in the new provisions, the moot question is why the atmosphere of confusion is being created by protesting against the same.

Today after a long period, a serious effort has been made in the interest of farmers and for improving their condition. Full provision has been made in these Acts to ensure that farmers get remunerative prices for their produce and all their interests are protected. I will ask political parties to think once again in the interest of the farmers and the nation before whipping up a false opinion.

(The writer is Union Minister, Agriculture and Farmers Welfare, Rural Development, and Food Processing Industries)

The rapidly worsening condition of the environment is increasingly creating harsh terms for agriculture in India. The sudden floods, such as those experienced by Telangana last week, and unexpected droughts in many areas coupled with a sheer drop in yield per acre are creating financial havoc for the farming community. Moreover, the recently-passed farm Acts have added to the woes of the already burdened growers. Farmers have become unsure of the future, especially regarding the produce and how the MSP (Minimum Support Price) will be impacted due to the entry of big players and whether the Government will continue to buy farm produce at the same price and quantity as before.

With the only means of voicing their concern being protests, the growers have of late tried to convey their feelings and insecurities regarding the Acts through demonstrations in Delhi, Punjab and other parts of the country. Sadly, their outcry has fallen on deaf ears till now. This muted response from the Government has now increased the farming community’s distress. This angst is expected to reach a crescendo in November when the agricultural community is planning to scale up the protests.

Already, the country’s farm sector is besieged by chronic problems such as mounting debt, poor quality seeds and overuse of pesticides besides the vagaries of the environment. However, being a hardy community and the spine of the Indian economy, the farmers have always fought their way through hurdles. The challenges thrown up by the environment in the form of rising temperatures and erratic rainfall, too, need to be met and responded to by the growers effectively and innovatively. The Government must enable farmers to deal with this instead of giving the impression of being callous about their  welfare.

As politics rages over the Acts, worrisome developments are escaping the attention of policy-makers and the authorities concerned. A decade-wise observation of rainfall patterns shows that from October to December, rainfall has been at a record low of 100.06 mm for the 2010-2019 period as compared to 106.29 mm during the similar period in 2000-2010. The average post-monsoon rainfall has fallen below 110 mm. Coupled with this, droughts are getting more frequent and prolonged each year. Mid-2018 saw heatwaves fanning across India followed by scanty rainfall in the same year and in 2019 as well. These circumstances exacerbated the already daunting challenges for farmers, who had to bend over backwards to take the yield out of the parched land.

The adverse impact of the worsening environment on agriculture cannot be reversed overnight but the lot of the farmers cannot be allowed to deteriorate further as well. Therefore, there is an urgent need to innovate and evolve agricultural methods and initiatives that are capable of rescuing them from the grip of climate change. There is also a need to provide a sustainable solution that can be amplified across the sector on a large scale. An example of how this turnaround can be affected is available in a study published in the journal Earth System Science.

The research focussed on rice crops, which are the mainstay of South India’s agriculture. Rice also happens to be a major part of the diet of the southern population. The study concentrated on how the rise in temperatures, followed by scanty rainfall, was impacting the rice yield in Kerala, which was the chosen field of observation. The participants, who included experts from Japan, recommended altering the varieties of rice to a more heat-resistant strain that could withstand the fluctuating temperatures and yet be resilient enough to deliver an adequate crop yield. The experts also opined that the traditional sowing time needs to be shifted in consonance with the changing weather patterns so that the crop is in tandem with the weather trends. They recommended sowing at the end of July or the beginning of August in order to improve the quality of crop and provide ideal crop maturity time.

The study is an essential tool that provides baseline observations for ensuring future crop planning and maximising yield that accounts for climate variables, maximum and minimum temperatures, rainfall and solar radiation. The fact that the study was able to asses future crop yield projection amid constant carbon dioxide and meteorological values is crucial.

Furthermore, the tool of Growing Degree Days (GDD) incorporated into the study helped provide robust outcomes and observations. For the uninitiated, GDD is a measure to estimate the growth and development of plants in the growing season. The study was conducted using the CERES-Rice Cropping System Model.

The importance of agricultural adaptation to climate change in the current period cannot be stressed enough as food security and nutrition levels have been compromised exponentially due to the COVID-19 pandemic. India accounts for 17.7 per cent of the world’s population and a failure of the agricultural system in the form of yield and quality deterioration at this critical juncture can present a catastrophic scenario. The multiple challenges posed by the environment, policy issues and the long-standing systemic glitches can spell disaster for the agri sector. Unless the writing on the wall is understood and deciphered in time, India may be staring at a food crisis post the COVID-19 outbreak.

Food production is critical to keep the wheels of the economy turning. We mustn’t allow climate change to hijack our food security. This is only possible by being a step ahead of climate change complications.

(The writer is an environmental journalist)

These days farmers across the country are agitating against the three farm Acts passed by the Government recently. If we analyse the status of agriculture today, we find that the sector is in dire need of innovation, both at the policy and ground level. Unless the Government deals with the real issues facing the farming community, nothing substantial will be achieved by simply reforming the existing structure that governs the sale and marketing of farm produce. Government officials and many in the public space think that the Commission for Agricultural Costs and Prices (CACP) is doing a great job in declaring the Minimum Support Price (MSP) for a range of items like millet, pulses, oilseeds and so on, other than wheat and rice. However, the fact is that only six per cent of the farmers and only `2.5 lakh crore out of the `40 lakh crore total output from agriculture are covered by the MSP.  From the point of view of food security, the MSP is an important intervention as it provides some financial security to the farmers and price stability to the consumers.

The main cause for concern is how to make farming profitable for the small and marginal growers who constitute 86 per cent of the farming community. They are neither able to invest in technology, better seeds and other inputs, nor in infrastructure. Most of them are at the mercy of the rain god who is now playing truant with them due to climate change, coupled with price instability and indebtedness. The rich farmers are able to manage somehow, but the poor get further indebted and trapped in bad loans.

Yet another problem is the reluctance of the younger generation to carry on subsistence farming. The Government must launch a climate adaptation site-specific programme for tackling the hydrology of the area to retain soil moisture. Increasing productivity is the only way we can double the farmers’ income. Take for example China. In 2010, it produced 500 million metric tonnes (MT) of grain from 143 million ha of net sown area. In India that year, this was only 240 million MT with the same sown area. Now with 140 million ha in 2020, we have inched closer to 300 million MT. Though the contribution of the farm sector in the GDP is around 17 per cent, it supports the livelihood of 58 per cent of the workforce of India. The Gross Value Added (GVA) by agriculture, forestry and fishing was estimated at `19.48 lakh crore in the current financial year (FY). The growth in GVA in agriculture and allied sectors stood at four per cent in the FY 2020-21. If the country wants to become a $5 trillion economy, we must lift the annual growth rate of agriculture by at least eight to 10 per cent in the next few years and then aim for more. This will require a concrete action plan.

As a first step, there should be planned networking to integrate land use with the adjoining forests through the creation of water bodies and implementation of watershed management schemes. This will help tackle climatic vagaries. The next approach is to opt for high value crop diversity for better production so that the return per unit of land used is enhanced. The farmers would require value addition and friendly market support. Though the Agriculture Produce Marketing Committees (APMCs) can no longer control the farmers, they can still be used for better procurement through the MSP and can become competitive with reforms in their functioning, specially by creating more facilities for the farmers in the context of the changed circumstances.

The Government should promote consortiums of investors and farmers while the small and marginal farmers should form cooperatives for negotiating with the sponsors for undertaking contract farming. In this venture, the APMC’s Mandi Samitis could also chip in to provide infrastructure and help. These cooperatives can create infrastructure and inputs for increasing productivity and help small farmers improve soil conditions and mitigate water scarcity through water harvesting. This will sort out the two major constraints in increasing production. Yet another help farmers need is to mitigate weather-related risks and for this, crop insurance policies must be made farmer-friendly. What do we do about the deteriorating soil health due to the overuse of pesticides and fertilisers? We must push for sustainable farming and the Centre and States must provide assistance to organic farming and conservation agriculture. As per the Compound Annual Growth Rate, the organic food segment is likely to grow from `2,700 crore in 2015 to `75,000 crore in 2025. 

The Government must take proactive steps to reform Indian agriculture to help production cross 500 million MT in the next two to three years. Only then can the farmers’ income be doubled. The first thing to do is to open the door to agitating farmers. After all, it is they who have been feeding the nation.

(The writer is a former civil servant)

The new farm laws might not be as disruptive as their critics want us to believe. They are apparently as logical and timely reforms as interventions like State procurement and notifying of Minimum Support Price (MSP) had been in the mid-1960s. The ruling and Opposition parties are engaged in a wholly avoidable fracas, both refusing to view things in totality. The Opposition is indulging in loathing and fear-mongering, reminiscent of the times when economic liberalisation was introduced in 1991. Paradoxically, it was the Congress’ Government then. The party now is behaving differently when in the Opposition.

The Government’s cavalier attitude to the Opposition parties’ stance is equally uncharitable. Motives have been imputed to their decision. They are accused of having a vested interest in the Agricultural Produce Market Committee (APMC)-run mandis, besides being friendly towards the middlemen who call the shots in those market yards. Ironically, on the National Agriculture Market portal (eNAM), started by the present Government in 2016, there were no less than 83, 958 commission agents registered as on August 31. Why is the Government promoting middlemen here?

The fear that APMC-run mandis would be abolished is largely unfounded. The eNAM platform can today boast of connecting about a 1,000 of them across 18 States and three Union Territories (UT). However, the passage of the Bills was not preceded by any kind of consensus-building. There was no dialogue with the farmers’ unions, State Governments or the Opposition parties. The laws were rushed through the Ordinance route on June 5. This starkly contrasts with the spirit of federalism and the consensus model that marked the implementation of the Goods and Services Tax (GST). The matters concerned with agriculture being under the State list in Schedule VII of the Constitution called for Centre-State consensus.

The legislative competence of Parliament to discuss a Bill on a subject placed in the State list (Schedule VII of the Constitution) was questioned by some members. However, we have precedence of the Seeds Act, 1966, which is a Central legislation. It was one of the key legislations enacted during the Green Revolution era. Still, one is reminded of how the Atal Bihari Vajpayee Government approached the contentious subject of contract farming. This was envisaged in the National Agriculture Policy 2000. Instead of bringing a Central law, the Government in 2003 circulated a Model Agricultural Produce Marketing (Regulation) Act to the States for adoption in 2003. The ensuing UPA-I Government continued the policy. Contract farming was included as an option in the National Farmers Policy (2007). By August 2007, a total of 15 States had brought amendments in the APMC (Regulation) Acts based on the model legislation.

Why did the four Labour Codes, recently enacted, did not become a source of dispute despite the presence of controversial provisions? This was because the Codes, meant to reduce 29 existing labour laws into four legislations, were vetted by the department-related Standing Committee of the Lok Sabha. It was chaired by Bhartruhari Mahtab of Biju Janata Dal. The Government agreed to several suggestions of the committee.

How justified is the claim that previous governments had kept the farmers in chains? Such a view stems from inadequate appreciation of facts. Definite pro-farmer measures were taken by Indian National Congress since 1937 when it formed governments in coalition in seven out of 11 provinces (under Government of India Act 1935). These included debt relief measures, tenancy reforms and licencing and regulation of money lenders and so on. But separation from Burma (now Myanmar) from the Indian Union in 1937 stressed rice availability in India.

India’s agricultural policy since Independence was aimed at attaining food security. With fragmented landholdings, inadequate electricity supply, pitiable irrigation facilities and poor acreage, production was insufficient. To bridge the requirement and availability of food grains, India entered into an agreement with the US under their Public Law 480 on August 29, 1956. It allowed India to obtain wheat, rice, cotton, dairy products and tobacco in Indian rupees. It could not, however, be denied that import of food grains, in excess of the market requirement, de-incentivised the farmer to produce more. The production increased as the imports were brought down to realistic levels around 1966. However, the completion of the Bhakra-Nangal Dam on Beas-Sutlej (1963) was an achievement of the Jawaharlal Nehru Government, which accelerated the advent of the Green Revolution.

The current regime of MSP and Government procurement is a legacy of the short-lived Lal Bahadur Shastri Government (June 11, 1964 to January 10, 1966). It had its origin in the decline in wheat production, consecutively between 1962 to 1964, and decline and marginal recovery of rice production during the corresponding period. This compelled the Government to revisit its open market policy for wheat and modest control on transport and sale of rice. The severity of the food shortage could be understood from the sheer number of speeches that Shastri delivered on the subject as the Prime Minister. His Selected Speeches, published by the Publications Division, Ministry of I&B (1972) categorises a total of 10 under “Food Problems.”

The Shastri Government moved in towards a regime of greater regulation and control on sale, purchase and movement of food grains. On January 1, 1965, two new organisations were created, which became the hallmark of the Government’s intervention in the agricultural sector. These were Food Corporation of India (FCI) and Agricultural Prices Commission (now Commission for Agricultural Costs and Prices). The ambit of Government procurement, which was limited to a few edible items in the beginning, now extends to 23 items (in addition to sugarcane).

The developments since the Green Revolution (1967) have led to the growth in acreage and food surplus situation. Time is ripe for addressing the neglected problem of agricultural marketing. In pursuit of doubling the farmers’ income by 2022 (from the level of 2016), the Narendra Modi Government formed a committee led by Ashok Dalwai, IAS. The committee produced a 14-volume eminently readable report. Though the decision to “liberalise” the farm was not among its direct recommendations, one has to realise that significant decisions are always political rather than bureaucratic in nature. The farmers must have better alternatives for remunerative pricing with legal safeguards. Even today, there is no legal restriction on farmers selling his/her product in the open market. What cripples the farmer, however, is not merely the logistical problem but also the absence of a legal architecture to protect his/her interests.

A single line in these Acts, like “notwithstanding anything contained in the aforesaid sections, no trade transactions should take place below the notified MSP”, would have allayed the misgivings of the farmers. A line in time could have saved the Government from putting eight Cabinet Ministers on ground (not including the Agriculture and Farmer Welfare Minister Narendra Singh Tomar) to convince agitating agriculturists.

(The writer is an author and independent researcher based in New Delhi. The views expressed here are personal)

Three new farm Acts were recently introduced in the country. The most important of these, the Farmers’ Produce Trade and Commerce (Promotion and Facilitation) Act, 2020 is aimed at putting an end to the monopoly of the Agriculture Produce Marketing Committee (APMC) mandis. Earlier, under the 1964 APMC Act, all the farmers were required to sell their produce at the Government-regulated mandis. The arhatiya (middlemen) in such cases helped the farmers in selling their crops to private companies or Government agencies. While APMCs will continue to function, farmers will now have a wider choice. But one of the powerful ways that growers can serve as their own middlemen is through a livelihood and development strategy that collectivises the smaller primary producers into locally-managed Farmer Producer Organisations (FPOs) which are then integrated into an inclusive value  chain. This is a sustainable, market-based approach in which resources of member farmers (for example, expertise and capital) are pooled to achieve more together than they can individually. It enables members see their work through an entrepreneurial lens and confers economies of scale, better marketing and distribution, more investable funds and skills, greater bargaining power, access to credit and insurance, sharing of assets and costs, opportunities to upgrade skills and technology and a safety net in times of distress. The best-known example of an FPO is that of Amul (Gujarat Cooperative Milk Marketing Federation Ltd), which is a dairy cooperative with over three million producer members.

In this model, thousands of scattered small farms are systematically aggregated and provided centralised services around production, post-harvest and marketing. This helps reduce transaction costs of the farms for approaching value chains and makes it easier for small farmers to access inputs, technology and the market. It also opens opportunities to bring primary processing facilities closer to the farm gates and helps producers gather market intelligence and manage the value chain better with digital agriculture tools. An FPO is a hybrid between a private limited company and a cooperative society. Hence one can see it enjoy the benefits of professional management of a private limited company as well as reap the benefits of a cooperative society.

Small-holder farmer producer groups are a key medium to build scale on account of the confidence, support and buyer/seller power they provide. They are able to achieve economies of scale through post- harvest infrastructure (collection, sorting, grading facilities), establishment of integrated processing units, refrigerated transportation, pre-cooling or cold stores chambers, branding, labelling and packaging, aggregation and transportation, assaying, preconditioning, grading, standardising and other interventions. The key benefit is the marketing support that links producers to mainstream markets through aggregation of subsistence-level produce into economic lots that can significantly raise the share that peasants get from the money people pay for their food.

The FPOs are owned and governed by shareholder farmers and administered by professional managers. They adopt all the good principles of cooperatives, the efficient business practices of companies and seek to address the inadequacies of the cooperative structure. The best way for these organisations is to leverage their collective strength through a full value chain from the farm to the fork. The underlying principle is similar to that of the full stack approach. This approach makes the sponsor, catalyst or promoter responsible for every part of the experience. In short, it is a whole-farm systems approach. It creates a complementary support ecosystem that boosts farm yields, reduces negative environmental impacts and increases market access and small-holder farmer incomes. It also provides sustainability interventions, including sustainable irrigation products and practices. Moreover, the value chain uses a business approach in order to make it viable.

Apart from the collective strength that group synergy generates, the support structures help in building the capacities of producers to deal with input suppliers, buyers, bankers, technical service providers, development-promoting agencies and the Government (for their entitlements), among others. One of the FPO’s important roles is linking farmers to reliable and affordable sources of financing in the funding ecosystem to meet their working capital, infrastructure, development and other needs. The collective works to reorient the enabling environment by influencing policies in this direction. The extension services available through the collectives include augmenting farmer capacity through agricultural best practices, agronomic advice, training on use of bio-fertiliser, pest management, modern harvesting techniques and access to optimal environmental practices. The success of a collective hinges on many factors: The technical support it receives, its institutional base, social and professional composition, land access and cropping patterns of members and adaptation of the model to the local context.

Sadly, rich farmers are significantly more likely to participate than the less privileged. They often become administrative members and use services substantially more for themselves than for rank-and-file members. It is, thus, necessary to strengthen democratic processes in these institutions.

Most promoters of the value chain are now successfully using the sub-sector approach, which allows for a focus on specific sub-sectors and helps in strengthening the ecosystem within which they are able to transition from a comparative to a competitive advantage. The value chain also facilitates capacity building support and use of modern tools including technology that can help to improve weather forecasting, agricultural processing, soil health monitoring crop identification as well as damage control, and mapping of available water resources. Some of these collectives are using digital tools to make farming climate-resilient, nutrition-sensitive and inclusive. The farmers are also able to achieve increase in the quantity, quality and consistency of production of crops. For achieving better scale, the value chain needs to steward limited resources and build production systems that natural systems can support over time. This logic embraces the use of soil management regimes that incorporate modest, targeted use of synthetic fertilisers to boost farmer incomes and production without affecting the quality of soil. The technical support is complemented by better water management through rain water harvesting and recharging of the ground water table; introduction of multi-cropping and diverse agro-based activities; use of low-cost and small plot irrigation technologies, which are commercially viable and environment-friendly. There is also a need for a policy to pool land or increase the size of holdings through collective farming or some other way. Consolidation of small-holders’ land holdings through cooperatives can also create synergies, especially for the leasing of large equipment or bulk input orders.  It helps in creating cold storage for controlling post-harvest losses. Financing for setting up micro-irrigation facilities and rainwater harvesting modules would help create an infrastructure for sustainable water supply and hence aid farm productivity.

FPOs should also be encouraged to participate in Minimum Support Price-based procurement operations. The eNAM platform can connect farmers with distant buyers. However, the biggest limitation of eNAM and other similar programmes seems to be that the vast majority of farmers are not tech-savvy. This is further compounded by low internet penetration and erratic electric supply. We need robust farmer-producer institutions which will have capital and the risk-taking ability to set up processing zones which are critical for preventing losses on account of rotting foodgrains. Together with FPOs, farmers can be their own middlemen and India can finally see the dream of farmers’ incomes being doubled being realised.

(The writer is a well known development professional)

The Opposition is staging protests against the recent farm reforms though the measures contained in the three Acts will enable barrier-free trade in agricultural produce and empower farmers to engage with investors of their choice. These Acts, which are a bid by the Centre to empower growers and double their income by 2022, will free them from unnecessary legislation, bring fundamental changes, give impetus to investment and increase employment in the agriculture sector, which in turn will strengthen the economy of the country. The promotion of contract farming will help farmers reach an agreement with food processing units/exporters on an individual or organised basis. It will also enable them to reduce the input of fertilisers and seeds, reduce other costs and use modern techniques to maximise products and get a better market as they will have the opportunity to work according to national-international demands.

The Farmers’ Produce Trade and Commerce (Promotion and Facilitation) Act seeks to create an ecosystem where the farmers and traders enjoy the freedom of choice relating to sale and purchase of produce. This facilitates remunerative prices through competitive alternative trading channels to promote efficient, transparent and barrier-free inter and intra-State trade. This was proposed because there were restrictions to selling agri-produce outside the notified Agricultural Produce Market Committee (APMC). And growers could sell the produce only to registered licensees of the State Governments. This legislation will open more choices for farmers, reduce marketing costs and get them better prices. It will also help growers of regions with surplus produce to get better prices and consumers of regions with shortages, lower prices. The Farmers (Empowerment and Protection) Agreement of Price Assurance and Farm Services Act seeks to provide for a national framework on agreements that empowers growers to engage with agri-business firms, processors, wholesalers, exporters or large retailers for services and sale of future produce at a mutually agreed remunerative price framework, in a fair and transparent manner.

This has been done because agriculture is characterised by fragmentation due to small holding sizes in India and has certain weaknesses such as weather dependence, production uncertainties and market unpredictability. This makes it risky and inefficient in respect of both, input and output management. Now the risk of market unpredictability will be transferred from the grower to the sponsor. Farmers have been given adequate protection and an effective dispute resolution mechanism has been provided with clear redressal timelines.

The Essential Commodities (Amendment) Act seeks to remove commodities like cereals, pulses, oilseeds, edible oils, onion and potatoes from the list of essential commodities. This will remove fears of private investors of excessive regulatory interference in their business operations. The freedom to produce, hold, move, distribute and supply will lead to harnessing of economies of scale and attract private sector/Foreign Direct Investment. Farmers suffer huge losses when there are bumper harvests, especially of perishable commodities and this Act will help drive up investment in cold storages and modernisation of the food supply chain.

The Opposition parties have Governments in different States and they should show what they have done for the farming community. Take the case of Uttar Pradesh (UP) which is striving hard to double the income of farmers. During the lockdown, the Yogi Adityanath Government exempted 45 items of fruits and vegetables from mandi fee, which benefited growers who are now free to sell their produce anywhere in UP. They also have the option to sell their goods in the mandis where only one per cent user charge is taken from traders. Besides, all 119 sugar mills of UP ran at full capacity and produced 126.36 MT of sugar after crushing 1,118 lakh tonnes of sugarcane. As a bumper kharif crop is expected, the Mandi Parishad and the State Warehousing Corporation are building warehouses of 5,000 MT capacity each in 37 mandis. Farmers can keep their produce here free of charge for 30 days, after which they will get 30 per cent rebate on the rent, so that they can sell their products when they get the best price. The UP Government has ensured that the produce will be recognised as a guarantee for the farmers to get bank loans. 

UP is developing 27 modern Kisan Mandis and in 24 of these, cold chamber and ripening facilities for preservation of fruits and vegetables are being made. This project will have a ripening chamber of 20 MT capacity and a cold chamber of 10 MT capacity. It is expected to be completed by 2020-21. Also, during the lockdown, 35.77 lakh tonnes of wheat was purchased, as were pulses and oilseed and it was ensured that the market price should be at least at par or above the Minimum Support Price. Now efforts are afoot to purchase paddy, pulses and oilseeds at the MSP in order to benefit farmers.

(The writer is a member, Legislative Council of Uttar Pradesh and vice-president of UP BJP)

The over-hyped green revolution of the late 1960s introduced varieties of dwarf rice and wheat in northern India with a cocktail of chemical fertilisers and pesticides that sucked up groundwater and gradually made it unfit for drinking. The chemicals leached into the soil and water. State-sponsored propaganda about “miraculous yields” extended the phenomenon across the country, ruining soil fertility and the nutritious value of food crops; the impact on public health was noticed by the medical community but all voices were silenced. Today, Gurdaspur-to-Delhi trains are called “Cancer Express”, yet there has been no medical study of the harm caused by chemical agriculture to the health of humans, animals, soil and water resources.

Now, four momentous laws could pave the way for a revolution in which farmers drive the change, with technology playing a supportive role. If the Government repudiates the genetically-modified food crops lobby, India could return to farming methods that do not require costly inputs and force farmers into a vicious cycle of debt (and even suicide).

On September 16, 2020, one day before the three agriculture-related Bills were moved in Parliament, the Banking Regulation (Amendment) Act, 2020 was passed, bringing all cooperative banks under the purview of the Reserve Bank of India (RBI). It means stricter supervision of 1,482 urban and 58 multi-state cooperative banks, with deposits of Rs 4.84 lakh crore.

The legislation undermines the strongmen who control the Agricultural Produce Marketing Committees (APMCs), mandis, loans and so on in many States. It is noteworthy that large farmers are resisting the new laws; earlier they opposed the Mahatma Gandhi National Rural Employment Guarantee Act, 2005 (MGNREGA) as they had to match wages or lose farm labour. The ongoing COVID pandemic has also improved the bargaining power of farm labourers and added to the bitterness of large farmers.

Often, agents arranged debt-funding for farmers from private moneylenders, who charged usurious interest and enjoyed political heft; such debt has been linked to farmer suicides in some States.

Simultaneously, the Union Cabinet approved the Rs 15,000 crore fund for animal husbandry as part of the Atmanirbhar Bharat Abhiyan stimulus package and a scheme for interest subvention of two per cent to “shishu” loan category borrowers for one year under the Pradhan Mantri Mudra Yojana. These developments form the sub-text of the farm Bills.

The Farmers’ Produce Trade and Commerce (Promotion and Facilitation) Act 2020 allows sale and marketing of produce outside notified APMC mandis. State Governments cannot collect market fee, cess or levy for trade outside the APMC markets; inter-state trade barriers are nixed and provisions have been made for electronic trading of agricultural produce. No licence is needed; anyone with a PAN card can buy directly from farmers. The new system provides a dispute resolution mechanism in case farmers are not paid immediately or within three days.

The APMCs failed as they allowed vested interests to seize the system. States levied cess to earn extra revenue that was not part of the budget and was used for “discretionary” development spending, mostly under the Chief Minister’s orders. As the cess increased, political appointees took charge of the APMCs. Even the Food Corporation of India (FCI) paid cess. Small farmers were burdened with the cost of transport to take their produce to the mandis and deal with middlemen. For instance, waiting outside sugar mills, with heat evaporating the sugar content in the cane, desperate farmers have succumbed to agents (of nearby mandis) who arrive miraculously and dictate the price.

Under the new Act, politicians and urban elite farmers will find it difficult to get large “agricultural” incomes mandi-certified and pay zero per cent income tax, as payments have to be made against PAN cards.

The Farmers (Empowerment and Protection) Agreement on Price Assurance and Farm Services Act, 2020 regulates contractual farming rules and State APMC Acts. Farmers can make contracts with a corporate entity or wholesaler at a mutually agreed price. The system already exists in 20 States; PepsiCo buys potatoes from 24,000 farmers across nine States. Further, 18 States already permit private mandis while Kerala and Bihar don’t have APMC mandis at all. More pertinently, the Act prohibits acquiring ownership rights of farmers’ land.

The Centre has funded Rs 6,685 crore for the formation of 10,000 Farmer Producer Organisations (FPOs) and the Rs 1 lakh crore Agriculture Infrastructure Fund (AIF). The FPO will give farmers higher bargaining power while AIF and market reforms serve as additional enablers. They can invest in farm equipment, infrastructure and build forward market linkages by making agreements with agribusinesses, thus improving access to technology and investment. Maharashtra’s Sahyadri Farmers Producer Co. Ltd, with 8,000 marginal farmers, exports 16,000 tonnes of grapes every season.

The end of socialist-era impediments should stimulate increased private sector investment across the value chain, creating jobs in logistics service providers, warehouse operators and processing unit staff. The rise of food-processing industries could create non-farm jobs in rural areas.

India processes less than 10 per cent of output (cereals, fruits, vegetables, fish, etc) and loses around Rs 90,000 crore annually to wastage. Hopefully, market linkages will motivate farmers to diversify and grow crops such as edible oils and help reduce India’s edible oil import bill that currently stands at over $10 billion.

Finally, The Essential Commodities (Amendment) Act, 2020 removes excessive control on production, storage, movement and distribution of food commodities; removes cereals, pulses, oilseeds, edible oils, onion and potatoes from the list of essential commodities, and paves the way for cold chain infrastructure to come up. Previously, control regarding the storage of essential commodities (onions, potatoes, edible oils, jute, rice paddy, sugar) gave draconian powers to authorities to raid “hoarders”, confiscate stocks, cancel licensing and even imprison offenders. This naturally discouraged investment in storage as entrepreneurs feared being prosecuted as “hoarders.” Lack of storage also contributed to volatility in prices as their stability depends on adequate warehousing infrastructure.

Henceforth, the ECA 2020 will be invoked only under extraordinary circumstances such as war, famine, natural calamity of grave nature and extraordinary price rise (100 per cent increase in retail price of horticultural produce over the preceding 12 months, or 50 per cent increase in retail price of non-perishables over the preceding five years).

Dismissing the propaganda that the new laws would end the minimum support price (MSP), the Centre has quietly ordered procurement, effectively nipping the canard that small and marginal farmers would be short-changed. Implementation will be the key.

(The author is a senior journalist. Views are personal)