Agriculture reforms only for traders and corporates, not farmers, say experts

The Government on Wednesday announced three “major agriculture reforms” for farmers, including an Ordinance to promote “barrier-free inter-state and intra-state trade outside APMC market” and amendment to the Essential Commodities Act., removing commodities like cereals, pulses oilseeds edible oils onion and potatoes from list of essential commodities.

Briefing about the three reforms after the Cabinet headed by Prime Minister Narendra Modi made the decisions, Agriculture Minister Narendra Singh Tomar called it a “historic day” in fact a day of “freedom for farmers”.

However, according to leading agriculture experts and activitists, the “reforms were for traders and not farmers”.

While Tomar said states are on board in the Ordinance, they believe many would consider it as “infringement of their power under the federal structure”.

Questions are also being raised on the move to impose ECA under extraordinary circumstances. Who will decide what the extraordinary circumstances are, experts said.

“Removing stock limits do not benefit farmers. They are not touching APMC, which is a good step. However, the real reform would be to expand the network of APMC ‘mandis’ in the country and assure that MSP becomes a legal obligation,” said agricultural policy analyst Devinder Sharma.

Agriculture expert Sudheer Panwar said, “It is the exporters, traders and processors who will benefit.”

“The amendment (in essential commodities act) has nothing to do with farmers. Regarding the Ordinance, trade outside ‘mandis’ is happening even now, only now there will be a law. Ever since liberalisation/WTO, the government’s thinking is consistent on market reforms,” said Panwar.

Giving a point by point rebuttal, Kavitha Kuruganti from the Alliance for Sustainable and Holistic Agriculture said amendments in Essential Commodities Act was related to farmers only to the extent that seed trade and fertilisers get regulated under some Orders of this Act.

“Otherwise, this was always about consumers, and to say that this will now benefit farmers is laughable. It will benefit traders from what one can see, neither farmers nor consumers,” she said.

Regarding amendments in APMC legislations and creating “One India – One Market”, she said there is no evidence to show that deregulation of markets as is the case with Bihar or Kerala has actually ensured remunerative prices for farmers.

“It is nobody’s case to argue that from now on, small and marginal farmers of the country (many are illiterate and lack knowledge/information about distant markets) who are the largest chunk of farmers are going to go in search of distant markets for better prices.”

“Better farmgate prices are not to be expected either, as long as farmers are trapped in the clutches of local traders who also double up as credit agents.”

“What should be ensured is remunerative prices which should become legally guaranteed entitlements, and oversight mechanisms for implementation, even as trader collusion and political interference in APMCs have to be stopped, and even as freedom to sell wherever a farmer finds a better market ensured. It is just corporations, traders and economists who would call them solutions,” she said

However, praising the government’s efforts, Agriculture Secretary Sanjay Agarwal said, “Farmers in India suffer from various restrictions in marketing their produce. There are restrictions for farmers in selling agri-produce outside notified APMC market yards. The farmers are also restricted to sell the produce only to registered licensees of the state governments.”

“Further, barriers exist in free flow of agriculture produce between various states owing to the prevalence of various APMC legislations enacted by state governments,” the Agriculture Secretary said.