What is the Farm Laws Repeal Bill, 2021?

 The Lok Sabha Monday passed the Farm Laws Repeal Bill, 2021 without any discussion. The Bill, which is aimed at repealing three farm laws, was introduced in the house by Union Minister of Agriculture and Farmers’ Welfare Narendra Singh Tomar.

What is the Farm Laws Repeal Bill, 2021?

The Farm Laws Repeal Bill, 2021 is aimed at repealing the three farm laws – Farmers (Empowerment and Protection) Agreement on Price Assurance and Farm Services Act, 2020, the Farmers’ Produce Trade and Commerce (Promotion and Facilitation) Act, 2020, the Essential Commodities (Amendment) Act, 2020 – and amending the Essential Commodities Act, 1955. The Bill was necessitated after Prime Minister Narendra Modi announced the government’s intention to repeal the three laws in view of ongoing farmers’ protests against these laws on November 19. Two days after the Prime Minister’s announcement, the Union Cabinet cleared the draft of the Bill. Now the Bill has been introduced in Lok Sabha.

How many sections are there in the Bill?

The six-page Bill contains only three sections. The first section defines the title of the Act – the Farm Laws Repeal Act, 2021, the second section has provisions to repeal three farm laws, and the third section relates to omitting sub-section (1A) from section 3 of the Essential Commodities Act, 1955.

What is sub-section (1A) under section 3 of the Essential Commodities Act which is being removed?

The government had inserted sub-section (1A) in the section 3 of the Essential Commodity Act, 1955 that empowers the government to control production, supply, distribution, etc., of essential commodities. The sub-section (1A) provides a mechanism to regulate the supply of foodstuffs, including cereals, pulses, potato, onions, edible oilseeds and oils under “extraordinary circumstances” which may include war, famine, extraordinary price rise and natural calamity of grave nature. It also prescribes the price triggers for imposing stock limits. Under the sub-section (1A), any action on imposing stock limit shall be based on price rise and an order for regulating stock limit of any agricultural produce may be issued if there is a hundred per cent increase in the retail price of horticultural produce; or fifty per cent increase in the retail price of non-perishable agricultural foodstuffs, over the price prevailing immediately preceding twelve months, or average retail price of last five years, whichever is lower.

Has the government given any reason for repeal of the farm laws?

Agriculture Minister Narendra Singh Tomar, who piloted the Farm Laws Repeal Bill, 2021, has stated several reasons for taking this legislative step. In a statement of objects and reasons, which forms the part of the Bill, Tomar said, “Even though only a group of farmers are protesting against these laws, the Government has tried hard to sensitise the farmers on the importance of the Farm Laws and explain the merits through several meetings and other forums.”

“Without taking away the existing mechanisms available to farmers, new avenues were provided for trade of their produce. Besides, farmers were free to select the avenues of their choice where they can get more prices for their produce without any compulsion,” the statement said.

“However, the operation of the aforesaid Farm laws has been stayed by the Hon’ble Supreme Court of India. During the COVID period, the farmers have worked hard to increase production and fulfil the needs of the nation. As we celebrate the 75th Year of Independence— “Azadi Ka Amrit Mahotsav”, the need of the hour is to take everyone together on the path of inclusive growth and development,” it said.

“In view of the above, the aforesaid Farm Laws are proposed to be repealed. It is also proposed to omit sub-section (1A) of section 3 of the Essential Commodities Act, 1955 (10 of 1955) which was inserted vide the Essential Commodities (Amendment) Act, 2020 (22 of 2020),” it states.

How many days the farm laws were in effect?

The journey of three farm laws began on June 5, 2020 when the President of India promulgated three ordinances­ – Essential Commodities (Amendment) Ordinance, 2020; The Farming Produce Trade and Commerce (Promotion and Facilitation) Ordinance, 2020; and The Farmers (Empowerment and Protection) Agreement on Price Assurance and Farm Services Ordinance, 2020. These ordinances were later replaced with proper legislation in September 2020. However, the implementation of three farm laws was stayed by the Supreme Court on January 12, 2021. So, these laws were in effect for only 221 days

Written by Harikishan Sharma

Source: Indian Express, 29/11/21

Why Punjab’s farmers oppose the new farm laws

 When the establishment ignores the historical context and the emotional component underlying any debate, mass protests can erupt to potentially shape the future. The people of Punjab would not have wanted a confrontation with the Union government, neither would I want to put it so bluntly, but around us, agitated farmers, with a strong common purpose, are energised in a way not seen in many decades. To nullify the possible impact of the three farm acts passed in haste by the Parliament, the Punjab government was compelled to pass its own bills on Tuesday. These broadly attempt to ensure continued procurement of wheat and paddy at the minimum support price (MSP), uphold the powers of the courts in dispute settlement and empower the state to regulate trade of foodgrain.

The three farm acts were preceded by a high-level committee in 2015, headed by Shanta Kumar, which suggested measures to reorient the Food Corporation of India (FCI)’s operations by shifting away from the public distribution system to cash transfers. This negates the very requirement of MSP procurement. The Commission for Agricultural Costs and Prices has been recommending reviewing the open-ended procurement of foodgrain, which is also reflected in the recent RBI annual report that says that the MSP is no solution to farmer’s woes. Similar views were expressed by a Union cabinet minister lately. Therefore, the farmers infer that a path that makes MSP procurement redundant is inevitable and fear it will become applicable after the 2022 assembly elections. To grasp the farmer’s resentment, I estimate the loss that may accrue to Punjab in the most probable way.

The MSP for wheat is Rs 1,925, and for paddy Rs 1,868. But in the absence of government procurement in Bihar and other places, normally crops sell 20 per cent below MSP. Similarly, without assured procurement in Punjab, the losses to the state could exceed.

Rs 15,000 crore. This has generated so intense an outcry that even BJP allies had to go to the extent of breaking long-forged alliances for fear of becoming politically irrelevant. Though it is more likely that the open-ended procurement of wheat and paddy will end.

In other states, procurement per farmer is capped at produce from 5 acres of land. For example, in Rajasthan, it is 25 quintals for moong and groundnut. Eventually, farmers fear that the same limits will be applied in Punjab; about 20 per cent of paddy and 25 per cent of wheat will not be procured and will sell below the MSP. This will lead to a loss of Rs 3,200 crore. Possibly, that is why central government functionaries have repeated that “MSP will continue” rather than clarifying that “procurement at MSP will continue as earlier”. To give them credit, their “truth” corresponds to Yudhishthira’s “untruth” when he stated, “Ashwatthama is dead”.

In adjoining states, central government agencies do not pay mandi fee on procurement. The new farm bills disallow imposition of mandi fee on produce procured outside the mandi’s physical boundaries. Should FCI or private traders trade outside the mandi space, the state will lose revenue of Rs 3,500 crore.Central government agencies do not pay commission to arhtiyas in their price support operations for oilseeds, pulses and cotton. If this practice is extended to Punjab, three-quarters of 24,000 arhtiyas and their employees will lose agency and employment. The annual loss will be about Rs 1,500 crore. Further, in the event of not being paid by the purchaser, they will start charging farmers extra fee under various pretexts.

After reneging on the promise of fixing the MSP by the C2+50 per cent formula, the government settled on the (A2+FL)+50 per cent formula where the derived MSP is far less. There are rumours that to stave off a financial crisis, MSP in the future will be calculated separately for each state depending on their cost of cultivation. If true, in Punjab, the MSP for wheat and paddy will reduce to Rs 1,035 and Rs 1,094 per quintal respectively — the loss could be more than Rs 26,000 crore.

An opportunity has been lost in the lackadaisical handling of the issue. Politics now threatens to complicate the process. I doubt if future historians will recall when Punjab changed course, and how an issue of farmer livelihoods morphed into one of Punjab’s survival. It is time to stop moralising.

This article first appeared in the print edition on October 22, 2020 under the title “A Question Of Survival”. The writer is chairman, Bharat Krishak Samaj

 Ajay Vir Jakhar

Source: Indian Express, 22/10/20