Hey there! Hope you're having a great week💖. It's always good to sit back and write something that pops into our minds. Today, I thought of writing about the Farm Bills which is now the talk of the nation. But before going into the discussion of farm bills and the reason for farmer's protest. I would like to clear something. Talking about bills, or acts, or an ordinance, people often confuse between these words. So, it would be better if I could make a clear sense of these three words that are similar yet different. So, Welcoming you to another informal besides a friendly blog of today.
I was once sitting in my classroom reading one of my subjects " Modern government", an interesting book rather. I considered it to be a general book of knowledge than a subject. As I was reading, I reached a point in the book which dealt with bills and acts. Reading that part made me wonder how foolish I was then as I used these words bills, act, and an ordinance interchangeably. It was then, I got to know the nuance of these words.
What is a Bill?
A Bill is a proposal for a new piece of legislation or law. It is a draft that contains a particular law to be passed in the parliament. If to figure out the similarity between a bill and an act. It is pretty simple - a bill remains a bill until it is in the parliament, once a bill is passed in the parliament, it becomes an act. Thus, it can be said that an Act begins as a bill.
What is an Act?
As mentioned above, Acts are written or printed texts of laws that are already passed in the parliament. An Act is commonly called as law. Thus, it starts as a bill (a draft of law), when passed and approved in the parliament, becomes an Act( law).
What is an Ordinance?
An Ordinance has a similar effect as an Act. The difference lies in its passing and authority. The ordinance is an authoritative order that is promulgated without passing in the parliament. Article 123 of the Constitution of India grants the President to make certain laws, and such laws are promulgated when the two houses of parliament are not in session. Ordinances are primarily issued during an emergency. This marks the difference between an act and an ordinance.
BILL -------------------------------------------------ACT(LAW)
PARLIAMENT APPROVAL
ORDINANCE---------------------------------------ORDER (LAW)
WITHOUT PARLIAMENT
APPROVAL
Hope this made clear sense, if not, READ IT AGAIN.😜
YEP, I think we are ready to go into the heart of the blog.
FARM BILLS,2020
It would be nothing new or fresh if I mention " Agriculture is the backbone of the Indian economy" or " Farmers, a sign of hope". It is well known even unto a first-grade kid. Farming has always been a noble profession that produces money from the mud. And any trouble to it brings a curse upon the land.
Farm Bills, 2020 presently called as Farm law, 2020 is a composition of three bills -
- Farmers (Empowerment and Protection) Agreement on Price Assurance and Farm Service Bill, 2020
- Farmer's Produce Trade and Commerce (Promotion and facilitation ) Bill, 2020
- The Essential Commodities(Amendment) Bill,2020
Above, the first two are newly introduced bills and the third one is an existing act which is amended.
The objective of the Farm bill,2020 is to give more protection to the farmers, to create a new ecosystem for them, and to overcome the flaws in the existing system. Seems quite good with the objectives but it does make the farmers of the nation a little upset. To know better, we need to jump back to the history of farm laws. But before, let me mention that these Farm Bills are recently introduced but are not new. In fact, they adopt the earlier method that dealt with farming which was later intervened by the government.
HISTORICAL BACKGROUND
Back in 1947, when the nation got independence from the British Raj, the whole system of the agricultural sector was dominated by money lenders, landlords, and traders in the villages. Farmers, being a deficit of money totally depended on these people. They had no means to sell their produce directly in the market.
Farmers before 1947 sell their produce directly to the consumers. To have a healthy production, they needed money and the only way for that was to get help from money lenders, landlords, and traders. The Interest set by the landlords were so high that the farmers failed to pay. Thus in the place of money, they gave a portion of their produce to the moneylenders compensating the interests. This cycle repeated and the farmers could never maintain sustainability. This was how the farmers in the nation became a matter of exploitation. This started to exploit the farmers in terms of severe debts. Farmers under the canopy of debt had to face a lot of problems which turned into a cruel system.
Then came the government. The government saw the exploitation of farmers and decided to intervene in the matter. This was when APMC was introduced.
APMC - Agriculture Produce Market Committee set by the government of India was the first attempt to bring reformation in the agricultural markets. APMC is commonly called as "Mandi". The government set up special areas in the state and declared them as market areas with subject to the jurisdiction of the market committee. These Market areas (Mandies) acted as a junction for the farmers and the traders to sell and buy the produce. But there were certain conditions, no farmer or trader would be able to sell or buy produce freely in the market. To do so, a trader must get a license and this made the government have control over these traders to some extend.
In connection with APMC, the government introduced MSP (Minimum support price) -it is an agricultural product price set by the government to purchase directly from the farmer. In simple words, it is a price below which the produce cannot be sold. The main objective of this was to protect the farmer from exploitation.
MSP was an incentive for the farmers to remain in cultivation. If some produce was left with the farmers, then the government would itself procure if the traders failed to buy.
Thus, it was an amazing deal for the farmers and all these things were regulated under the state APMC act. Everything was alright with this system and farmers were happy.
While this system was on, people thought that farmers sell their produce in APMC under MSP. Yeah, they did so, but not all farmers were aware of MSP. According to the report by NITI Ayog on MSP in 2014, it says 81% of the farmers were oblivion of MSP. They even didn't know if such a thing exists. And according to 2015 reports, only 6% know about MSP, who were benefitted from it.
WOW👌... What a game of irony. It was introduced for farmers' benefit but resulted in a situation where most of them are not at all aware of. Where government thought it would protect the farmers from exploitation, wherein inturn it started another game of exploitation of farmers in certain places. But in places like Punjab, Haryana, APMC marked an impressive network of mandi, where it benefits the state's development.
As most of the produce was perishable (vegetables and fruits), farmers have to sell them off somehow. Taking this as a fortune, the commission agents and the traders started forming cartels and dealings with one another to collectively not to buy produce from the farmers at a specific rate that was set by the farmer but at the rate which they would set. Thus the farmers were left with no option but to sell at the rate fixed by the agents and traders as his produce would perish if he fails to do then.
In such a case, the agents would fix the price exactly at MSP, and the farmer had to sell them at that price, returning home with no profit. So these were the flaws of APMC during the years from 1947
COMING BACK TO THE PRESENT
Now the Government of India introduced three bills with a motive to create "one nation, one market", to give farmers the freedom of choice to sell their produce wherever they wish to, inside APMC or outside APMC.
The three bills are :
- Farmers (Empowerment and Protection) Agreement on Price Assurance and Farm Service Bill, 2020
- Farmer's Produce Trade and Commerce (Promotion and facilitation ) Bill, 2020
- The Essential Commodities(Amendment) Bill,2020
FARMERS (EMPOWERMENT AND PROTECTION) AGREEMENT ON PRICE ASSURANCE AND FARM SERVICE BILL, 2020
This bill mainly focuses on empowering and protecting the farmers' interest through a legal agreement. " Price assurance and farm service" - this means there will be a fixation of price by the proper negotiation between the farmer and buyer protecting the farmer from getting cheated by business owners. In case of any dispute, this bill provides a dispute settlement mechanism between a farmer and a buyer by an established authority to prevent any changes of thought regarding price or any other form of exploitation.
This bill empowers farmers for engaging with processors. It will transfer the risk of market unpredictability from the farmer to the buyer. Due to price determination and assurance, the farmers will be protected from the up and downs of the market price. This bill also enables the farmer to access modern technology and better seeds. Its aim is to reduce the cost and increase the income of farmers.
THE FARMERS' PRODUCE TRADE AND COMMERCE (PROMOTION AND FACILITATION BILL,2020
Gazing at the title, it says " Trade and Commerce", "Promotion and facilitation", that means this bill talks about the trading of farm goods outside the physical premises of Mandi or APMC such as farmgate, cold storage, warehouse, processing units. It creates an ecosystem where the farmers and traders will enjoy the freedom of choice of sale and purchase of agri-produce. Farmers will be able to engage in direct marketing eliminating all the intermediaries resulting in full realization of price.
THE ESSENTIAL COMMODITIES ( AMENDMENT) BILL,2020
As mentioned earlier, it is not a new bill, but the central government had made an amendment in the existing Essential commodities bill. It is a law that controls the production, supply, and distribution of certain commodities. To avoid situations of hoarding and Artificial demands, the central government has regulated certain food items as essential commodities. This Amendment allows the central government to regulate the supply of certain food items only under extraordinary circumstances (such as war and famine). Stock limits may be imposed on agricultural produce only if there is a steep price rise.
PROBLEM AND PROTEST
The main problem or issue in the case was the fear of losing APMC. In states like Punjab, there is an aggregated tax of 8.5% of the minimum support price. This includes market fee 3%, rural development cess 3%, arthiya commission 2.5%.
Thus, this amounts to a big source of state revenue. However, these new bills do not step into the matter of APMC or MSP, rather it gives the farmers another option besides APMC to sell their produce.
Selling the produce within APMC would charge taxes such as market fees, commission charges, rural development cess.
These bills state that if a farmer sells his produce outside APMC, he would have no taxes on sale and purchase.
The reason for the protest is that the farmers alleged that if the government permits a sale and purchase outside Mandis(APMC). This would pose more attraction towards outside to the buyers due to the absence of taxes which would eventually result in a huge disadvantage for the farmers.
Farmers have a good opinion on APMC as these Mandis are regulated such as maintaining transaction accounts, the applicability of MSP. Whereas, outside APMC, there is no MSP and there is no regulating body to ensure the fair treatment of farmers from getting exploited.
As said by Devinder Sharma, food and agriculture expert, " Actually, it is one country, two markets" referring to the motive of these three bills, he says that though the government has made no disturbance regarding APMC and MSP, still there exists a chance where APMC would be affected. We know that if the traders buy inside APMC, then they would have to pay the mandi tax. But, if private companies buy, they would definitely opt for outside Mandis, because they would not have to pay taxes. So, the traders and the companies would prefer to buy outside without any payment of taxes. Gradually, people will also move out of the Mandis resulting in the redundant of Mandis. When the Mandi system (APMC) collapses, then obviously, the MSP that was assured to the farmers would also decline gradually.
Finally, APMC will become a mere empty land.
Thus, the prediction of the fading away of APMC resulted in a stirring protest among the farmers, especially, of Punjab and Haryana
OPINION
In my opinion, the objectives of the Farm bills are good for protecting the farmers from exploitation. It would be better if MSP is applied for both inside and outside APMC. Another way would be an improvement of APMC by building it up and removing its flaws, placing and regulating thousands of Mandis in India. This would help in the sustainability of APMC. Framing new laws for the Regulation of MSP, as demanded by the farmers, would also help in improving the overall income of farmers.
Yeah.... This was all about the Farm Bills and the protest.
For any doubts, welcoming you to post in the comment box below. And you can also suggest to me any topics for the next blog.
Thank you, Live the Law
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