Agriculture contributes approximately 15 per cent of the nation’s GDP and in terms of employment, ~41.49 per cent. The yield is obviously low. We live in times where food shortage isn’t a concern, as much as nutrition is – but that’s a different line of argument.
Farmer’s protest is unsettling. It’s been almost a month that thousands of farmers from Punjab, Haryana, and Rajasthan have been braving the cold and demanding that the three recently-introduced laws be abolished. Are they justified in their claims? Are they Khalisthanis, as many in the ruling party suggest? Or have they been misled by the opposition? It is rather unpleasant (downright ugly?) to see these sights on TV and constantly being reminded on social media while decrying their motives.
The truth is layered and both sides have a point of contention. In Covid times and inclement weather, if thousands are risking their lives then their voices cannot simply be stifled and said to be “politically motivated.”
What is APMC?
Post-independence, there was a need to protect farmers from exploitation and with that intent, the idea of APMC was birthed. Wiki: ”An Agricultural Produce Market Committee (APMC) is a marketing board established by state governments in India to ensure farmers are safeguarded from exploitation by large retailers, as well as ensuring the farm-to-retail price spread does not reach excessively high levels. APMCs are regulated by states through the Agriculture Produce Marketing Regulation (APMR) Act.”
The new Act proposes that farmers can sell outside their APMC Mandis, thereby opening up and letting market forces take over.
Those genuflecting at the altar of Capitalism would see great merit in this. But we have to also take into account that agriculture is a low-yield sector and farmers suffer ingloriously throughout their lifetime due to this. Added to this, are factors such as small farm holdings, inadequate mechanization adoption, a clutch of middlemen, and a host of other factors that have piled up over the last seven decades.
Of course, farmers get exploited by the middlemen even today, but if the market opens up, there’s great fear that farmers will be at the mercy of corporate houses which by definition have greater heft and in effect will lead to greater exploitation. As the adage goes – a known enemy is preferable to an unknown friend.
To step away from the decades-old APMC structure is a bold move. What stops the government (as a follow up) to do away with MSP – the price paid by the government when it procures any crop from the farmers? Presently, there are 23 crops under MSP but FCI which is the main State-run grain procurement agency buys only paddy and wheat at these prices. The Food Corporation of India then sells these foodgrains at highly subsidized prices and is compensated by the government to cover the losses. There’s great apprehension that in the next move, MSP will be removed. This again isn’t far-fetched because MSP does not have a legal mandate – not now or even earlier, and it’s a “commitment” that all governments have met on their part. But, this government is known for its disruptive behaviour and hence there’s a merit that such a possibility howsoever remote, may turn to reality. To draw an imperfect analogy – after all, who in India could have known or expected DeMonetization?
The state of Punjab and Haryana are amongst the highest producers of wheat and removal of MSPs will hit them the hardest.
Now the question – does Indian agriculture require major reforms? The answer is a resounding YES, but there’s a caveat. This is NOT the year to do so! This is a bad year and certainly not the appropriate one to shake up a system which has already taken a body-blow because of the pandemic.
Wheat is a water-guzzler and over many decades it has caused great damage to the water table in Punjab but it’s not going to be easy to shift the farming patterns and switch over to other crops. Where’s the minimum guarantee? There are no clear answers either that can be arrived at through a mathematical model.
Arguably, what works best is incentivising. Perhaps, we need to look at schemes where farmers are incentivised to produce other crops which are monetarily more beneficial than sticking to the age-old regime of MSP.
Who has a voice?
All the farmers who are protesting, do they know of these clauses, I mentioned? Probably not but why should that matter? When this government was elected in 2019 because 30 crore voters chose to cast their ballot in their favour, the question was never asked whether the voters knew about the party’s election manifesto? Yet, they voted and the nation accepted the fact. In a democracy as large and diverse as ours, it cannot be expected that people will have complete knowledge. Democracies function because the common man has a voice.
Let us not stifle it.