Understanding the ruckus over two farm bills passed by two houses of the Parliament

Farmers demand: MSP should be a Legal Right.

Two bills related to agriculture, namely The Farmers’ Produce Trade and Commerce
(Promotion and Facilitation) Bill 2020 and The Farmers’ (Empowerment and Protection) Agreement
on Price Assurance and Farm Services Bill 2020, were passed by the Rajya Sabha last Sunday. There
was major ruckus inside and outside the Rajya Sabha over these two contentious bills.
The opposition wanted to refer the two bills to a select committee. However, the motion for the
same could not make its way through the house. It must be noted that despite calls for a division
vote by the opposition, the bills were passed by a voice vote.
In the aftermath of what happened in the Rajya Sabha last Sunday, several opposition MPs were
suspended. They continued their ‘dharna-pradarshan’ outside the parliament building while the
Rajya Sabha continued to pass bill after bill, without any opposition.
What’s more is that it is not only the opposition political parties that are protesting against the two
farm bills. Notably, parties that are part of the NDA like the Akali Dal and AIADMK have also opposed
the bills. Harsimrat Badal (of the Akali Dal) resigned from the Modi government’s cabinet over this
issue.
According to a report by NDTV, over 265 farmers groups are protesting against the farm bills. While
Punjab and Haryana experienced intense protests, other states like Uttar Pradesh, Bihar, Karnataka,
Kerala, and West Bengal also saw several protests by the farmers.
What the government says
The government’s point of view can be understood by reading how The Farmers’ Produce Trade and
Commerce (Promotion and Facilitation) Bill, 2020 was introduced. So to say, the bill is for the
“creation of an ecosystem where the farmers and traders enjoy the freedom of choice relating to
sale and purchase of farmers’ produce”.
It can be deduced that the government wants the people to imagine a utopian neo-liberal market
where any trader from any part of the country can buy produce from any farmer. A market where
the farmer as well as the consumer would get justified prices as a result of competition. From the
central government’s point of view, the farm bills are a crusade against the corruption and
exploitation of farmers by the APMCs.
To facilitate this, these two bills bring about some major changes in how agricultural business is
carried out in India. The first major change is that no tax can be levied on any farmer or trader in this
new ‘trading zone’ that the government is creating. The second change is that farmers can now
enter in ‘contracts’ with potential sponsors.
Contracts, the government says, are a way for the farmers to get investment and assurance.
However, it must be noted that this assurance is not assured by civil courts, but by sub-divisional
magistrates instead. Both the bills clearly specify that civil courts will have no jurisdiction over
trading activities occurring within the ambit of the said bills.
What the protesters say
The farmers fear that the first effect of these bills will be the collapse of APMCs. While, APMCs have
indeed been a source of exploitation for the farmers, they are also a source of minimum support
price (MSP). The collapse of APMCs means the collapse of MSP, the farmers say.
Why would the APMCs collapse? It is because taxes are levied on the trade being carried out in
APMCs. Now they will compete with trading zones that don’t have to pay any taxes. As a result of
this competition, the farmers fear, APMCs (and therefore MSP) will collapse.
The other fear is the vulnerability and lack of resources that the farmers will face in contract farming.
This fear is further aggravated by the fact that civil courts hold no jurisdiction over these matters.
As a result, what the farmers demand is that MSP should be a legal right, a new policy for the
calculation of MSP, and loan waivers. Amid the ruckus, one thing seems to be clear- the government
did not consult stakeholders before bulldozing these two major legislations through the two houses
of the parliament.