More on Farm Bills

A Correspondent

It is doubtful it three farm reform bills—passed under controversial circumstances in parliament—will lead to the establishment of private markets for farmers to sell their produce, said agricultural economist R Ramakumar.

"The other question is whether private markets would indeed come up as a result of these reforms. The experience of Bihar, Kerala or Maharashtra do not inspire confidence in this respect.

The Bihar government abolished its Agricultural Produce Market Committee (APMC) Act in 2006, Kerala never had the law and Maharashtra changed its own APMC law in 2018 on the lines of what is today officially known as the Farmers' Produce Trade and Commerce (Promotion and Facilitation) Bill, which is soon to become law.

And yet, private markets and investments have not yet flown into these states. "Where are the private investments in these states? Including in Maharashtra, most big corporate retail firms purchase their food items directly from APMC markets, and not directly from farmers. This shows the importance of APMC markets, and the need to strengthen them," argued Ramakumar.

Establishment of private wholesale markets for farm produce and provision of a legal framework for contract farming, two of the many ways in which farmers can sell their produce directly to companies by apparently eliminating middlemen, are among the key anticipated outcomes of the agriculture reforms pushed by the Narendra Modi government through the controversial amendments to three laws related with agricultural marketing.

The three laws, which were amended recently are: the farmers produce trade and commerce (promotion and facilitation) Bill, the farmers (empowerment and protection) agreement of price assurance and farm services bill, and the Essential Commodities (Amendment) Bill.

Thanks to the amendments to the laws mentioned above, private wholesale markets are expected to be among the several new avenues which would henceforth be legally available to farmers for selling their produce to private buyers at competitive prices.

Thus far, farmers had to sell food grains at the government run APMC markets which are controlled by vested interests. But now they can transact anywhere and in a variety of ways, which include the private wholesale markets as well as contract farms.

According to Professor Ramakumar, however, this is easier said than done. Going by the experiences of Bihar and Maharashtra, the economist said, it won't be easy to merely replace private markets with the well established APMCs.

Frontier
Vol. 53, No. 17, Oct 25 - 31, 2020