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Thrishul Farm Bills in India
The document reviews three agri-market reform bills aimed at increasing agricultural competitiveness, enhancing farmers' income, and liberalizing market regulations in India. It details the provisions of the Essential Commodities (Amendment) Ordinance, the Farmers' Produce Trade and Commerce Ordinance, and the Farmers (Empowerment and Protection) Agreement on Price Assurance and Farm Services Ordinance, focusing on issues such as electronic trading, contract farming, and dispute resolution. Additionally, it discusses institutional impacts, historical context, and the influence of international pressures on domestic agricultural policies.
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Thrishul Farm Bills in India
- 1. Dr. Narasimha ReddyDonthi Public Policy Reviewer 3 AGRI-MARKET REFORM BILLS :TRISHUL EFFECT ON 3
- 2. Market Support byGovernment Regulation of markets Input subsidies Minimum Support Price Food subsidies
- 3. Three Ordinances: 5thJune, 2020 The Essential Commodities (Amendment) Ordinance, 2020 The Farmers’ Produce Trade and Commerce (Promotion and Facilitation) Ordinance, 2020 Farmers (Empowerment and Protection) Agreement on Price Assurance and Farm Services Ordinance, 2020
- 4. The Essential CommoditiesBill, 2020 Objectives • Increasing agriculture competitiveness • Enhance farmers income • Liberalise regulatory system • Protecting consumers interests Provisions • Removal of all food stuffs •Supply of food stuffs regulated only under extraordinary circumstances •Regulatory order doesn't apply if stock limit is within installed capacity or export demand
- 5.
- 6. PreviousAmendments to EC •67 control orders between 1972 and 2020 • 5 orders from 1972-78 • 0 orders from 1978-2002 • 8 orders in 2009 alone • With effect from 15 February 2002, 11 classes of commodities in full and one in part removed from the list of essential commodities declared earlier. • Removal of Licensing requirements, Stock limits and Movement Restrictions on Specified Foodstuffs Order, 2002 • Dealers allowed to freely buy, stock, sell, transport, distribute, dispose, etc., any quantity • Wheat, paddy/rice, coarse grains, sugar, edible oilseeds and edible oils, without requiring any license or permit under any order issued under the Act.
- 7. Trade and CommerceBill, 2020 Objectives •Farmers and traders to enjoy freedom •Barrier-free trade •Framework for electronic trading •Traders, Farmers producer organisations or cooperative •PAN for trader •Payment to farmer same day or within 3 days
- 8. Trade and CommerceBill, 2020 •Any person can open/ establish electronic trading and transaction platform •No market fee, cess or levy under any APMC or any State law •Price information and market intelligence system by central govt •Suspension of platform by Central govt
- 9. Trade and CommerceBill, 2020 •Dispute Settlement •Settlement within 30 days by designated authority •Sub-Divisional Authority for DS, Collector as Appellate Authority •Bar on jurisdiction of civil court •Not to apply for Stock Exchanges and Clearing Corporations •Central government has powers to give directions
- 10. e-NAMTrading - Commodities CategoryNo. Food Grains/ Cereals 25 Oil Seeds 13 Fruits 29 Vegetables 40 Spices 14
- 11. Contract Farming Bill,2020 •National framework on farming agreements •Farmer can enter into agreement •Terms and conditions of such supply, including time of supply, quality, grade standards, price and other such matters •Terms related to supply of farm services •Minimum period of 1 crop season to 5 yrs or as mutually agreed
- 12. Contract Farming Bill,2020 •Sponsor prohibited from acquiring ownership rights •Linked to credit or insurance scheme of the government •Electronic registration of agreements, by a State- appointed Authority •Not to apply for Stock Exchanges and Clearing Corporations •Central government has powers to give directions
- 13. Contract Farming Bill,2020 •Dispute Settlement • Settlement within 30 days by designated authority • No action for recovery of dues against farmers • Sub-Divisional Authority for DS, Collector as Appellate Authority •Bar on jurisdiction of civil court •Overriding effect on any State law Land Ownership, quality of soil, interests of small and marginal farmers
- 14. Crops and Contracts Sugarcane •Contract farming with sugar factories • Pricing • Delayed Payments Potato • Contract farming with PEPSICO India Holdings • Pricing • Violations Cotton Seed Oil Palm • Contract farming with processing units • Pricing • Imports • Delayed Payments
- 15. Trishul Effect: 3on 3 • Powers • Income State • Income • Land and other resources APMCs • Prices • Access • Quality Consumers • MSP • Income • Crop shift Farmers
- 16. Constitution: source ofpower •empowers the States to enact APMC Acts under some entries •List II of Seventh Schedule (State List), •Entry 14: ‘Agriculture …’, •Entry 26: ‘Trade and Commerce within the State ….’ •Entry 28: ‘Markets and fairs’. • CentralGovernment • List III of the Seventh Schedule (Concurrent List) • Entry 33 which covers trade and commerce and production, supply and distribution of foodstuffs, including edible oilseeds and oils raw cotton, raw jute etc. • Entry 42 in the Union List, viz., ‘InterstateTrade and Commerce’ also allows a role for the union.
- 17. APMCs •2,477 principal regulatedmarkets, 4,843 sub-market yards regulated by the respective APMCs •Average coverage 463 sq. km or 12 km radius. •Assam - 6442 sq. km (45 km radius) •Punjab - 116 sq. km of area (6 km radius) •APMC charges include Market Fee (1/2%,) VAT (5%), Driage (1%), RD Cess (5%), Comm. To society (2.5%,) Admin. Charges (2.5%), Custody & Maintenance charges+ Interest Charges (2.5%), Comm. To society (2.5%), Nirashrit Shulk (0.2%) •27,924 rural periodical markets or haats (regulated and unregulated) - average area of 146 sq. km or a radius of 7 km
- 18. States and APMCs Kerala NoAPMCs No private investment Maharashtra 305 APMCs Loss Rs.120- 150 crores Annual turnover Rs.48,000 crores Bihar No APMCs No income rise
- 19. Issues: NAM vs.APMCs • Model APMC Act, 2003 • Contract farming allowed • Direct sale allowed • Working Group on Consumer Affairs 2011 • 33 Recommendations of the State Ministers’ Committee on Agricultural Marketing Reforms 2013 • Reforms to Agriculture Markets • Promotion of Investment in Marketing Infrastructure Development • Rationalization of Market Fee/ Commission Charges • Contract Farming • Barrier Free Markets • Market Information System • Grading and Standardization • Other Recommendations
- 20. Institutional Impacts ofTrishul– 1/2 • Institutions aimed at regulating the market conduct, structure (a) Regulation of primary agricultural produce markets; and (b) Legal and regulatory provisions relating to storage, transportation, packaging, processing, buying/selling and quality specifications. The specific institutions in this category are: State Agricultural Marketing Board (SAMB), State Department of Agricultural Marketing (SDAM), Agricultural Produce Marketing Committee (APMC), Directorate of Marketing and Inspection (DMI), Health Department, Civil Supplies Departments of the Central and State Governments, etc. • Institutions providing Physical infrastructure: SAMB, APMC, Public Works Department (PWD), Food Corporation of India (FCI), Central and State Warehousing Corporations and cooperatives.
- 21. Institutional Impacts ofTrishul– 2/2 •Institutions involved in administered prices: FCI, National Agricultural Marketing Federation (NAFED), Cotton Corporation of India (CCI), Jute Corporation of India (JCI), Commission for Agricultural Costs and Prices (CACP), State agencies, and Fair Price Shops (FPS). •Institutions entering the markets directly: some of the above plus commission agents, producers or consumer cooperatives, FPOs and processors. •Institutions influencing foreign trade: Agricultural and Processed Food Export Development Agency (APEDA), and some Commodity Boards
- 22. WTO – InternationalPressures •Negative Support to farmers 2000-18 (-5.7%) •Budgetary spending + market price support – gross farm receipts •Total budgetary support is estimated at 2.9% of GDP – decrease. •Price-depressing effect of domestic regulation Public Stockholding • Peace Clause Food subsidies • AoA Trade Facilitation • ???
- 23. Understanding debate contours •Nota public vs private debate •Profit vs. Equity and Justice •Federal vs Union •Food sovereignty •Seed Sovereignty •Farmers freedom •Economy, Environment and Ecology
- 24.