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1. MSP Presentation by
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2. Farm Bills
• The three ordinances were — The Farmers’ Produce Trade
and Commerce (Promotion and Facilitation) Ordinance,
2020, The Farmers (Empowerment and Protection)
Agreement on Price Assurance and Farm Services
Ordinance, 2020 and The Essential Commodities
(Amendment) Ordinance, 2020.
• The Union Cabinet announced that the ordinances were
promulgated to ease farmers’ access to markets across the
country, help them enter contracts for assured returns and
exempt more farm products from the Essential
Commodities Act (EC) respectively. These ordinances were
introduced by the Modi government to ease the impact of
Covid-19 on farmers in India.

5. British contribution !
India Followed !!

7. Indian economist Dr. Arvind
Virmani

11. There is no disputing agrarian distress. Equally, higher MSP alone will
not redress the stress (Why agriculture cannot wait). Revival of
agriculture demands its liberation, induction of technology, and
reforms by the states to create an enabling ecosystem. It is not
enough to generate ideas. The ideas of a national market for
agriculture and the draft legal template for group/collective/contract
farming can boost investments, per acre yield and farmer incomes
but are stranded between intent and execution.

12. There is no escaping the estimated cost of Rs 35,000
crore this imposes on the national exchequer. The
price of higher borrowing and larger debt will visit
interest rates and currency value.

13. The APMC Conundrum
Recent reform of agricultural marketing would upset those who have guaranteed income from Agriculture
Produce Marketing Committee (APMC), but for the majority of the farmers, there is no downside.

14. WHO ARE ARHTIYAS IN GRAIN-BOWL STATES?
• The arhtiyas -- the main legitimate link between farmers on the
one side and procurement agencies/buyers on the other -- in the
two grain-bowl statesPunjab and Haryana
• In this existing system, the arhtiya intermediaries receive a
commission of 2.5 per cent, which levy on the FCI and other
buyers as part of state taxes on procurement.
• The commission agent exploits the farmer on the one side & beats
the very concept of MSP by Government Support on the other side
• The Arhtiyas pay the entire payment in cash, without any
paperwork.
• The commission agent, however, foresaw no threat to his business
from the new laws, saying farmers remain heavily dependent on
the arhtiyas.
• Similar Commission agents exist all over the country acting as “go
between” among Farmers, Government officials, private Traders ;
the business of commission agents will continue as usual.

15. Middlemen or Service Providers: What Role Do Arhtiyas
Play in Market Yards?
• Thee Centre has said that the farm Bills will relieve cultivators from
the 'clutches' of the commission agents
• Arhtiyas, who have operations in Punjab and Haryana mainly,
provide services to the farmers after they bring their produce to
the APMC market yard. They fear that with the implementation
of the laws and the setting up of parallel private market yards,
the APMC market will lose relevance and their mandi labour,
over 3 lakh of them, and arhtiyas will eventually lose all work.
• Arhtiyas are not middlemen. They take a commission (2.5%) for
the work they do and the services they provide to the farmer.
There’s hatred towards arhtiyas because they are money
lenders also
• In the absence of institutional credit for many farmers, they
depend on arhtiyas for money.
• Once farmers get caught in the cycle, it is difficult for them to
come out of it. That’s why historically and culturally, arhtiyas
have had a bad reputation

16. Explained: Why are Punjab arhtiyas under the I-T
dept scanner?
• The Arhtiyas pay & Receive the entire payment in
cash, without any paperwork
• Reportedly, non-institutional sources like
arhtiyas finance almost 66.74% of loans in
unbanked villages and 54.45% of loans in
areas that have a bank in Punjab.
• There is need to make the arhtiyas’ lending
process transparent because the clutches of
non-institutional loan are also one of the
main factors behind farmer suicides in
Punjab.

17. Food Corporation of India
• The procurement programme of the FCI is an open-
ended one, which accepts fair quality offered and does
not halt purchases at any time. Therefore, there are
excess stocks with the government, creating another
set of problems: locking up of capital, exposing the
foodgrains to the threat of rot, etc. As of September 1,
stocks of rice and wheat stood at 70 million tonnes
against a buffer stock norm of around 41 million tonnes.
On June 1, stocks were 83 million tonnes against a
norm of 21 million tonnes.
• MSP is a misnomer because the government steps in to
purchase rice and wheat regularly as part of the Public
Distribution System. The PDS has been sidestepped
partly under the DBT, which suggests that the ration
shop may not be required in the long run. In that case,
what happens to the foodgrains that are procured?

18. • There is politics involved as successive governments
work to placate farmer groups. Due to the existence of
such pressure groups, the MSP programme has
become a shibboleth that cannot be touched.
• On the other side, as households have no lobby
groups, there is no representation at the policy
level. When fuel subsidy was removed, and the
middle class paid more for its LPG and kerosene,
there was no objection.
• When the fixed income earners see their incomes
being denuded by a continuous lowering of
interest rates, there is no lobbying for their
interests.
• In such a case are we making too much noise
on this issue due to the political undertones?

19. Who will the Farm Bill benefit?

20. Luxurious farmhouse
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