The three farm bills passed in September 2020 aim to reform agricultural trade in India by allowing farmers to sell produce outside of regulated markets, enter into pre-agreed contracts with buyers, and remove restrictions on storage of certain commodities. However, farmers have protested the bills, worried that they will be exploited by private buyers and that the government will stop supporting minimum prices for crops. The bills are seen as more favorable to companies than farmers. There is uncertainty around whether the reforms will lead to higher prices and better conditions for farmers, or leave them vulnerable without government protections.
2. What is a farm bill?
On 20th September 2020,parliament passed three farm bills ,which created
protests in the country.
The Three bills are:
1.The Farmers Produce Trade and Commerce(Promotion and Facilitation)Bill,2020.
2.The Farmers(Employment and Protection)Agreement on Price Assurance and Farm
Services Bill,2020.
3.The Essential Commodities(Amendment)Bill,2020.
The farm bill is a package of legislation passed roughly once every five years that has a
tremendous impact on farming livelihoods.
3. This bill allows barrier-free intra-and inter-state trade of farm produce.
Farmers can eliminate middlemen and sell directly to instituitional buyers at prices to be agreed
between them.
Prohibits state governments from levying any market fee for the trade of farmers produce
conducted in an ‘outside trade area’.
4. This law will allow farmers to enter into agreements with agri-farms,exporters or large buyers to
produce a crop for a pre-agreed price.
Minimum period: one crop season; Maximum period: five years(unless the production cycle is
more than five years).
5. Seeks to remove cereals ,pulses ,oilseeds ,edible oils, onion and potatoes from the list of
essential commodities.
This Bill proposes to allow economic agents to stock food articles freely without the fear of
being prosecuted for hoarding.
6. Bypass the Essential Commodities Act and be free to store inventory which was constrained so far
by stocking limits of ESCA.
Free to make contracts and transfer risk to businessmen in deals made over a crop even before
yield is made or met.
With Farmers’ Produce Trade and Commerce bill, farmers can sell the produce as per their choice.
So the problem of middlemen, which is one of the main loopholes of APMCs will be eliminated.
7. The acts are more favorable towards the companies and not legally empowering the farmers.
Farmers are worried that MSP will be removed.
APMC reforms are needed , not its removal.
The middlemen will NOT go away.
Farmer’s groups are worried this exposes them to corporates who have more bargaining power
and resources than small or marginal farmers.
8. There are two possible scenarios after the
implementation of these bills:
1. SCENARIO-A
Private markets-higher prices for produce-better for
farmers.
2. SCENARIO-B
No more govt support of MSPs-Farmers at the
whims of market/corporates.
