Looking beyond Farm Bills

    15-Dec-2020   
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What the Government, Union and Farmer need to do
 

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Farmers Protesting at Singhu Bordar in agaisnt of Farm Laws 2020
 
Punjab has been reeling under a massive agitation launched under the banner of the Kisan (Farmer) Unions that are functioning in the State. The agitation is a reaction to the passing of three Acts by the Indian Parliament -The Essential Commodities (Amendment), Act 2020; The Farmers Produce Trade and Commerce (Promotion and Facilitation) Act, 2020 and The Farmers (Empowerment And Protection) Agreement on Price Assurance And Farm Services Act, 2020, which the farmers of Punjab feel are against their interest. The bills are collectively termed as the Farm Bills.
 
The matter kept festering at the local level for about two months and has now taken a serious turn with Punjab and Haryana farmers having proceeded towards Delhi in large numbers. Certain mischievous elements have infiltrated the agitation and are attempting to create dissension and divisiveness. These mischievous elements might add 10-15 per cent boost to current agitation, but that is also a fairly generous assessment. They are not succeeding in their attempts. The main body of the protestors, who are genuine farmers, are focused only on the basic demands. The protest, therefore, cannot be seen as anything other than an expression of discontent of the farming community of Punjab and Haryana. Any attempt to look at the events as a “mischievous element” sponsored movement would amount to missing the pulse of people.
 
The agitation also has a political connotation with most parties getting aligned against the rule NDA Government at the Centre and more specifically the Bharatiya Janata Party (BJP). The BJP has a minimal presence in Punjab, but the idea here is to embarrass it at the national level.
 
“The objective of this paper is to look at the issues concerning agriculture in the nation and particularly in Punjab against the backdrop of the ongoing agitation and beyond it”
 
The paper has been prepared after taking a large number of views from across various segments of society including those who are active in the farming profession in Punjab and those who have dealt with agriculture in an official capacity. Contributions have also been made by academicians and others who have looked into the social and security aspects of the existing situation.
 
There is an overwhelming view that the immediate concern should be to stop the agitation. The imperative nature of this requirement emanates from the fact that thousands of our patriotic countrymen are out in the street in this terribly cold weather. Among these are people of advanced age who have given a lifetime of hard work and sacrifice for the development of the country. They do not deserve to be inconvenienced in this manner.
 
Apart from the all-important humane angle, the whole world is watching the unfolding events leading to an incredibly negative impact on the international stature of the country. The enemies of the nation are leveraging the same to weaken the fabric of the nation. They will, of course, not succeed but a long drawn out agitation will give them a motivation to strengthen their efforts.
 
The government is being projected as hard, selfish and uncaring, mainly through social media and abrasive statements by political rivals. Rumour mongering is rife. The result is a mounting trust deficit and hardened stands by all stakeholders.
 
It is necessary for all to adopt a more accommodating path.
 
No political party in a democratic dispensation will take a step that is detrimental to 60 per cent of the voting population as is the strength of the farming community in India. This, by itself, is reason enough to believe that the ruling NDA and more particularly the BJP had the good of farmers in mind when they drafted the bills. No bill or act can be perfect/all-encompassing and the same is the case with these three bills too. It is a fact that has been accepted by the government as will be explained in successive paragraphs. Somewhere along the line, the communication weakened leading to the present unfortunate situation. It is this aberration, more than anything else that needs to be removed first of all.
 
The Government of India (GOI) is engaged in negotiations with the Kisan Unions to find a middle path and diffuse the tension. There have been a series of meetings between the Kisan leaders of Punjab and the government represented by senior ministers including the agriculture minister, Narendra Singh Tomar. The government has agreed to consider amendments in the Acts to meet the serious concerns of the farmers as represented by the Union leaders. Bringing about such amendments, however, will be a long drawn and complex process requiring extensive discussion since states other than Punjab are also involved. It would be entirely appropriate for the Kisan Unions to accept the genuine offer of the government and call off the protest while carrying on with the discussion. By taking the extended hand of the government the Unions will only raise their stature.
 
Any discussion on the subject has to be carried out against a backdrop of understanding the contribution of Punjab in converting the nation from a food importer to a food surplus entity based on the green revolution. Of the total area under food grain production in India, Punjab has 5.02 per cent; yet, it contributes 10.15 per cent of total food grain in India. It means Punjab feeds every tenth person in India. It is something that cannot be trifled with. The discussion also needs to keep in mind the position of Punjab as the most sensitive frontier state of the nation and one whose people have always stood as sentinels of national security.
 
Under no circumstances can the contribution of these people be denigrated; their misgiving have to be considered with due diligence and removed in their entirety since the matter goes beyond food production to national security.
 
On their part, the farmers of Punjab have to sit across the table with a conviction that the government is their own and will not renege on the word given. Any attempt to get more than what is reasonable from the government in the garb of the agitation should be curbed. If good relations are now established, they will pay dividends in the longer run.
 
Getting down to the problem at hand—it can be safely divided into two main factors. First, APMC Mandis’, though flawed, had been established to get rid of the “free market” problem. Before the Mandi system came into being farmers used to be at the mercy of “free market” read middlemen/loan sharks and had to sell their wares at substandard prices. With the Mandi supported by the MSP system in place in Punjab/Haryana, farmers were able to get a low but stable return for their produce. This ushered an era of relative stability if not total prosperity. Farmers feel that by recreating a free market system, the governments will kill the stable Mandi system, which will lead them back to the bondage of five decades earlier. Farmers are not anti-progress, but they don’t want radical surgery at this time and certainly don’t want to go under” knife” without discussing the pros and cons.
 
Coming back to the bills per-se. Many of the provisions in the bills are already in practice not only in Punjab but across India. In April 2013, Punjab Government passed the Punjab Contract Farming Act to provide a legal framework to contract farming. The Punjab Act did not have a provision mandating that sale cannot be below the MSP. In fact, Punjab has witnessed contract farming for a long time now with more and more urbanised families opting for the Thekha (giving land on contract for tilling) system. The people, therefore, are well aware as to how this system works. Similar provisions for contract farming have been legislated in many other states too. The central Acts are merely giving the process a uniform legislated framework 
Second, the Land Reforms Act, 1955, restricted landholdings. States enacted their acts in the 1960s. The Land Ceiling Act 1972 was passed at the national level restricting holdings of irrigated land from 10 to 18 acres per family. It resulted in fragmentation of land holdings that has reached a nadir in recent times. In India, 66 per cent of the population lives in rural areas and are in some way or the other, connected with agriculture. Corporate entry into agriculture will hit hard the bulk of the farmers who have small landholdings. With no other employment avenues available, this will lead to a very complex problem. The centre, first and foremost, needs to ensure the security of these teeming millions for which special legislation’s need to be put in place.
 
It is the two aspects as mentioned above that the government needs to keep in mind while discussing the problem with the Kisan Unions. Short of repealing the act, mechanisms have to be found to ensure that the security of small farmers is ensured under all circumstances. The government needs to do so, not for the Unions but for the overall good of the country.
 
Coming back to the bills per-se. Many of the provisions in the bills are already in practice not only in Punjab but across India. In April 2013, Punjab Government passed the Punjab Contract Farming Act to provide a legal framework to contract farming. The Punjab Act did not have a provision mandating that sale cannot be below the MSP. In fact, Punjab has witnessed contract farming for a long time now with more and more urbanised families opting for the Thekha (giving land on contract for tilling) system. The people, therefore, are well aware as to how this system works. Similar provisions for contract farming have been legislated in many other states too. The central Acts are merely giving the process a uniform legislated framework.
 
The State Government has the right to carry out amendments to the acts and create a system that meets local aspirations better. It has done so already. The Punjab Vidhan Sabha has unanimously passed three Bills to counter the farm laws enacted by the Union Government. Among other things, the state bills make buying wheat and paddy below minimum support price (MSP) a punishable offence. With these conditions in place, there should be no insecurity at the local level for the Punjab farmers. If agreeable, the centre can push for clearance of the Punjab bills.
 
There is nothing in the bills that is binding upon the farmers. They can reject the use of the provisions in the state as well as the central legislation’s. If they so desire they can stay away from doing business with private players and not opt for contract farming. The government will always remain the biggest buyer since it has national food security targets to meet. The government has given legislated safeguards for those who wish to go it alone. Surely, this cannot be grudged by anybody.
 
The paper has been prepared after taking a large number of views from across various segments of society including those who are active in the farming profession in Punjab and those who have dealt with agriculture in an official capacity. Contributions have also been made by academicians and others who have looked into the social and security aspects of the existing situation. There is an overwhelming view that the immediate concern should be to stop the agitation 
Punjab has a system of Adhatis in place, the world looks upon them as middlemen, but Punjab considers them to be service providers who assist in the marketing of the produce. If the Punjab farmers wish to continue with the process, they can do so.
 
The business of Adhatis also needs a closer study. What, for instance, makes this business so attractive that thousands of wealthy people wish to be a part of it? Surely they are not there to do social service for the farmers. There are talk and allegations of blatant corruption in the grading of the produce, its measurement, adding of pollutants etc. The system is definitely the last vestige of the “License-Permit Raj” that was broken down by the opening up of the economy. That it is continuing proves that some very powerful forces do not want to see the end of it. Is it because the system has allowed political patronage networks to flourish? What could be the reason for the same?
 
It is also relevant for the farmers to reconsider whether this system has any use in modern times of fast communication, internet facility and advanced education within the family, would they like to pay massive commissions or work independently. It is estimated that the “Adhati Service” comes for Rs 2000 crore annually in the two main crops every year. The matter is worth a thought. The farmers can consider a switchover in a graduated manner; the Acts are not forcing them to do anything in the very next crop.
 
Farmers need to understand whether MSP is really good for them or has it been bondage all these years. An average government servant in the 1970’s joined service at the basic pay of Rs 700 per month. On retirement in the first decade of the 21 century his/her basic pay had reached a figure nearing or above rupees two Lakh (an increase of 320 times). The rate of growth in pay and perks in the private sector would obviously be even higher. During the corresponding period (the 1970s to the early decade of 21st century) the MSP for wheat increased from Rs 85 per quintal to Rs 1350 per quintal (including bonus) which is an increase of less than 16 fold. It is this disparity that the Unions should have been discussing with the successive government all these years and should be discussing now, rather than attempting to keep the farmers in “financial bondage” for all times to come. As it is the surplus foodstuff in MSP regulated regimes unofficially sells at rates much below the declared MSP’; MSP, therefore, institutionalised corruption.
 
The Government and the Unions should not forget that Agriculture in its current form cannot be sustained anywhere in the world without government support that normally comes in the form of subsidies or Fair Remunerative Price (FRP) that the government assures should the price fall below an acceptable level. Farming in the US, Australia and the EU is heavily subsidised, which means that they can undersell all other farmers in the world out of existence unless supported by their governments. It is this aspect that the Unions and the Government should be more concerned about. A better idea is for the Government and the Unions to work towards coming up with innovative schemes of ensuring the farmers get remunerative prices for their produce, whether it is through subsidies or any other means.
 
The issue of crop diversification and organic farming poses a long term challenge for the State Government and the Kisan Unions. Crop diversification by itself is a long-drawn and challenging process. Fruits and vegetables at a commercial scale will continue to require the use of pesticides and lots of water; hence, the basic environmental problem will remain. Organic farming will require the fields to stay untouched for about five years, which not many farmers can afford unless they are assisted. Yet, the farmers in Punjab have to come out from the Wheat-Rice cycle since it is neither good for the soil nor commercially viable any more with more and more land in India coming under similar production. The commercial viability of small farm holdings is at a very low ebb already, so alternatives have to be put in place.
 
It is the responsibility of the State Government and the Kisan Unions to find and apply alternatives, something that they have been unable to do with the required sense of urgency. If the matter had been addressed seriously by the successive government in Punjab and if the Kisan Unions had insisted on its phased and graduated application, things would not have come to such a pass when the proud Punjabi farmer is begging the government to give an assurance that his sacred produce will be picked up at rock bottom prices that the government itself has decided.
 
At the personal level, the Punjabi farmer will need to strengthen his entrepreneur spirit further. and work on alternative avenues of employment domestically or foreign shores. For this, the education system will need to be revitalised. It is not enough to depend upon the government for the same, our vibrant Diaspora that comes to the forefront for each and every agitation needs to walk the talk by loosening their pockets to assist their farmer kin who are keeping the flame of tradition alive acquire some skills and education. We, as an agrarian economy, are in a quandary and must reach beyond this vocation or look at consolidation. The next generation of Punjab needs viable solutions and alternatives.
 
Finally, there are matters like adjudication of disputes where the centre felt that the bureaucratic level would be more effective. If, however, the farmers are happier with a higher level of adjudication, the centre should have no problems in making requisite amendments. Private Mandis can also be brought under the taxation net, and registration norms for private traders can be made more stringent.
 
For governments and the nation, it is important to always bear in mind that farming is a hard way to earn money and keeping farmers on the job is a national prerequisite more important than winning elections. In Punjab more so since an exodus here will give our enemies a free run. Punjabis have beaten the business class and corporates at their own game and can do so in this case too. Any more of this will lead to food insecurity and danger to national integrity. It is now for the nation to decide.
 
(The writer is a a reputed analyst of Indian defence and security affairs, has an abiding interest in issues related to national security, internal security, geopolitical developments and defence strategy)