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What 1970 did for milk & 1991 did for industries, 2020 will do for agriculture

Modi Government passed Farm Bills from Parliament and have called it the biggest reforms in Agriculture sector. Congress led opposition have opposed the bill saying that it is a Draconian law which will turn farmers into slaves.

Let’s understand the bill and the questions & issues associated with it.

The biggest issue raised by opposition against the bill is that what will happen with the Minimum Support Price(MSP). After the government clarified that they’ve no plans to remove the MSP, opposition have asked for the reasons of MSP not being included in the bill. Answer is quite simple. MSP has never been part of legislation and rather is an administrative mechanism. If MSP becomes part of legislation, it’ll get rigid and difficult for the necessary changes required from time to time.

Another issue is related to MSP benefits in case of private transactions and protection of rights of farmers from private players. MSP is the minimum amount fixed by the government for the crops. One will go for private transactions only if they will be getting rates more than the MSP decided by the government. So there is no reason of concern for the farmers to be exploited by them. Due to private players, farmers will now have more options and the earnings of farmers could significantly rise due to the new opportunities. Also the sale, lease or mortgage of farmers land is prohibited under the new bill, it is unlikely that private players will be able to exploit the farmers.

Is MSP system got weak under Modi Government is the another question. To understand it better, let’s see the figures of MSP during different regimes. Congress led UPA have purchased 1.52 Lakh Metric Tones of pulses and 3.65 Lakh Metric Tones of oil seeds as MSP in 2009-14 while BJP led NDA purchased 76.85 Lakh Metric Tones of pulses and 30.17 Lakh Metric Tones of oil seeds as MSP in 2014-19. This shows that Modi led NDA government actually made MSP system stronger by purchasing more crops.

Next big issue raised is with regards to contracts and technologies and whether private traders could bind farmers through the mode of contracts and other legal methods. Let’s understand it through a legal eye. Contract made by farmers can be dissolved by them without paying any penalties if they have taken no advance amount. In case of an advance amount taken up by a farmer, a contract could still be dissolved by returning the amount, that too with no interest amount. Also the contracts will be limited only for farming, specific products and specified time as per farmers choice and thus, chances of exploitation is further reduced.

The reason for such huge opposition by few political parties are not due to their ideologies since they’ve called for similar law in past. The opposition we see today against the bill by the parties is probably because of the removal of middleman from the whole system. Modi Government have opened bank accounts of over 200 Million families across India in their first tenure through their flagship program Jan Dhan Yojna. Since then, Modi Government have paid amounts including subsidy & MSP(except Punjab) through Direct Bank Transfer scheme in which the amount given by the government to the beneficiary is being paid directly in the bank account of the concerned person without involving any middle man.

Now one may ask if the new bill is really good. To understand it better, let’s get through the fact that the biggest work force in the country comes from farming sector however the people involved in this sector are living with very low income and miserable life many time leading them to die by doing suicide. With the new bill, overall condition of farmers may change due to the rise in demand for all kinds of goods and services which in-turn may help the GDP growth. Earlier farmers had the option of only going to a specific place to sell their crops. But with the new bill in place which have allowed private players and open market, there will be introduction of new technologies, better seeds, modern equipment & higher investment which in turn will make stronger economy. Also due to more money involved, there will be more crops, in-between-season crops, improved yields & better logistics.

What 1970 did for milk & 1991 did for industries, 2020 will do for agriculture.

It is a well settled fact that whenever the restrictions are removed and government get away with socialist mentality, specific sector improves. Socialism have damaged India to core and we need to get rid of it by allowing reforms.

Author: Adv. Shashank Shekhar Jha
Legal Editor,

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