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Opinion

Farm Laws Demystified

Sudeep Mahajan

Sudeep MahajanSep 29, 2021, 06:39 PM IST

Farm Laws Demystified

The protesting farm bodies fear that the new farm enactments would take away the existing and the well-entrenched APMCs and MSP. Neither of these two Acts mentions a word about dismantling the APMC, so the Central Government has devised no means in law that would do away with the APMCs and the MSP.

 

Given the turmoil caused by the new farm enactments, particularly in Punjab, these new farming laws must be understood clearly and in their correct perspective, without wearing the googles of any hue. Various farm bodies have raised serious concerns that need to be addressed to help return to order and tranquillity.

The foremost fear of the protesting farm bodies has been that the new farm enactments would take away the existing and the well-entrenched Agricultural Produce Marketing Committees (APMCs) and, along with it, the Minimum Support Price (MSP) regime. This, it is feared, will force the farmers to sell their produce to corporate sharks at whatever price they would dictate.

It is therefore very important to know what exactly is provided in these new farm laws. A comprehensive study of the two relevant Acts, i.e. "The Farmers (Empowerment And Protection) Agreement On Price Assurance And Farm Services Act, 2020" and "The Farmers' Produce Trade and Commerce (Promotion and Facilitation) Act, 2020", would reveal that nothing can be further from the truth. Neither of these two Acts mentions a word about dismantling the APMC regime anywhere in their texts, which means that the Central Government has devised no means in law that would do away with the APMCs and the MSP. Therefore, the simple conclusion has to be that the present system of APMCs and the MSP of food grains is not going anywhere and is staying put. This assertion is further confirmed by the Government's willingness to give written assurance to agitating farmers on the continuation of MSP for the food grains and APMCs, along with the private mandis.

The second serious concern about the new farm laws is that big corporate houses or companies will take over their lands, and farmers, being comparatively on weaker grounds, will not be able to fight them off. To effectively alleviate this fear, it is important to examine the provisions of "The Farmers (Empowerment And Protection) Agreement On Price Assurance And Farm Services Act, 2020" in this regard. Section 8 of the said Act provides as under; -

                                                                                   8. Sponsor (i.e. a person who has entered into a farming agreement with the farmer to purchase farming produce) prohibited from acquiring ownership rights or making permanent modifications on farmer's land or premises.–No farming agreement shall be entered into for the purpose of –

(a) any transfer, including the sale, lease and mortgage of the land or premises of the farmer or

(b) raising any permanent structure.....

Section 8 of the Act, governing Contract farming, thus makes it very clear that there will be no farming agreement between the farmer and the sponsor (i.e., the Corporate body) that will include in its scope, in any manner, the transfer of farmer's land or his premises or sale or lease or mortgage of his land or premises. After that, S. 15 of this Act makes it further explicit that even if any order is passed against the farmer, in the process of dispute resolution, between the farmer and the sponsor (or the Corporate body), for the recovery of any dues against the farmer, no action shall be initiated against the agricultural land of the farmer.

                                                            15. No action for recovery of dues against farmer's land. Notwithstanding anything contained in Section 14, no action for recovery of any amount due in pursuance of an order passed under that section shall be initiated against the farmer's agricultural land.

It is clear that the Act pertaining to contract farming already has ample provisions to safeguard all the interests of farmers regarding their land. The same is not going anywhere owing only to contract farming. There already is a prohibition in the Civil Procedure Code (CPC) against the attachment of the house and the land attached to the house of an agriculturist, under Section 60 (c) CPC.

Apart from the provisions mentioned above, there are other safeguards contained in these farming Acts to protect the interests of the farmer, such as Section 5, which contains a provision to the effect that the price to be paid for the purchase of farming produce be mentioned in the agreement itself and if fluctuation in the price is feared, a guaranteed price for the agricultural produce, can be laid down in the agreement itself, which the sponsor or the corporate body will have to pay, even if the price of the Agri-produce, contracted for, later hits rock-bottom levels.

As already provided in both the Acts mentioned above, the dispute resolution mechanism seems to be very effective and ought not to be sought to be altered by the farm bodies. The formation of a "conciliation Board" consisting of the parties' representatives, as in arbitration, will facilitate effective and quick resolution of disputes. On the other hand, the civil court route for dispute resolution will be very cumbersome and expensive and will suffer from perpetual delays.

The third legislation is by way of an amendment in "The essential Commodities Act, 1955, which makes the supply of foodstuffs free of regulations, except only in "extraordinary circumstances" such as war, famine, extraordinary price rise, etc. It is so done because it has been felt for some time now that farmers have been unable to get remunerative prices due to lack of investment in cold storage, where houses and processing, etc. This provision has the potential of empowering the farmer in the real sense, as ample storage capacity will enable the farmer to control pricing in the farm sector; for instance, when a farm market is likely to be flooded by particular products, the farmer can check the glut of the produce in the market by holding on to the product and storing the produce in cold storages or warehouses for the time being.

It will be fair to say that there has been a consensus between the various Political parties and the farm experts/ farm bodies now for quite some time that the farm sector is long due for an overhaul by the introduction of a liberalised regime, which will give farmers the freedom to trade even outside the APMCs. In fact, the Congress Party, in its election manifesto of 2019, promised to altogether abolish APMC Acts. In contrast, the new farm laws have not repealed APMCs and the MSP and have only made it possible for private marketing yards to co-exist along with APMCs. Chapter 7, clause 11 of Congress's election manifesto reads as under; -

                                                  "11. Congress will repeal the Agricultural Produce Market Committees Act and make trade in agricultural produce–including exports and inter-state trade - free from all restrictions."

Does the question then arise why are farmers opposing these salutary new provisions in the Agricultural sector? While attempting to answer this question, it must be kept in mind that there is a section amongst the Punjab people who have always been distrustful of the Union Government. Please remember the movement started in the early eighties by a political class in Punjab on the grounds of alleged "WITKRA" (discrimination) by the then Central Government that went horribly out of control. It is quite clear by now that this movement also contains elements other than mere farmers. Some political parties or outfits of left orientations think that they now finally have a stick to beat the Prime Minister with, even if they, to achieve their purposes, have to mislead or fool the naïve farmer, who mostly would not have cared to read and acquaint himself of the actual text of these new farm laws, they will go right ahead and do just that.

(The writer is an Advocate at Punjab & Haryana High Court, and Ex. Additional Advocate General Haryana)

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