Studies show that implementation of Farm Laws leads to big losses, writes DR SOMU.
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The countrywide response to the call for a Bharat Bandh by the Samyukt Kisan Morcha, an umbrella body of over 500 farmers’ organisation was overwhelming. There was a deserted look in almost all major cities as shops and markets remained shut and rail and other public transport were disrupted. All left-leaning and other political parties (except BJP), an array of trade unions, students, teachers, youth, dalit groups, and women’s organisations took to the streets as part of Chakka Jam and blocked national and state highways. The huge success of the Bharat bandh boosted the spirit of lakhs of farmers who have been protesting for the last 13 days at various borders of Delhi.
This success also busted the myth propagated by the ruling BJP and its supporters that the farmers’ protests are mainly localised in Punjab and Haryana, and that most farmers in the country are in favour of these laws.
The huge success of the Bharat bandh all over the country and the tremors of protest that have now developed into a quake have shocked the ruling NDA government.
Union Home Minister Amit Shah stepped in and hurriedly invited 15 farmers’ organisations for talks on the same evening as the Bandh. However, Amit Shah’s meeting with representatives of protesting farmer leaders on December 8, 2020 failed to resolve the deadlock over the farm laws. The leaders rejected the government’s offer to amend new farm laws and stuck to their demand for repeal of the laws during the meeting.
This success also busted the myth propagated by the ruling BJP and its supporters that the farmers’ protests are mainly localised in Punjab and Haryana, and that most farmers in the country are in favour of these laws.
The government sent 13 proposals to amend the three controversial laws on the afternoon of December 9. These included a written assurance to continue the Minimum Support Price (MSP), authorising state governments to allow mandis (market yards), and discouraging takeover of farmers’ land by big corporates, but the farmers firmly stuck to their demand that the farm laws be repealed, unanimously deciding to continue the protests more vigorously and demanding a total rollback of the three laws.
The sixth round of meetings scheduled on December 9 with government have been called off as farmer leaders refused to attend it.
It appears that the ‘guaranteed MSP’ promise is to lure bigger farmers away from joint struggle, hence pushing the smaller farmers into isolation. But the Samyukt Kisan Morcha declared that it was against any attempt to divide the farmers and would always stand united.
Opposition parties, on the other hand, met President Ram Nath Kovind on December 9.
The major problem with the so-called ‘guaranteed-MSP’ proposal of the government is that the three ordinances that were turned into laws do not mention the MSP. Therefore, private companies are still free to buy from farmers, and that too at lower rates.
This idea of corporate takeover, exemplified by two of India’s most powerful conglomerates, has become a major rallying point for the farmers.
There is hence a chance that the purchases to be made through the mandi system will fall. “And if there is fall in government purchases, the authorities will find an excuse to shut down the mandi system by claiming losses,” declares speaker after speaker at the protest sites.
Already during the last two months after controversial bills were enacted in Parliament and storage limits were removed for grain, potatoes, vegetable oils under the Essential Commodities Act, Adani group has acquired 100 acres of land at Noltha village near Panipat in Haryana just 110 km from Delhi. The firm is actively constructing godowns, transport, even railway tracks to facilitate its planned mandi trade. It is learnt that the group is planning to construct 900 such sites across the nation for storing grain and other non-perishable farm produce to assist its retail trade. Hence, interestingly ‘Ambani-Adani’ has become a catch-phrase at Singhu border. The names of these two companies are now synonymous with corporate control over farmers and rural India.
Farmers at protest site claim that the agri-business corporation always paid much lower prices than those agreed upon and also that the defaulted payments stretch into several instalments with long gaps in between.
This idea of corporate takeover, exemplified by two of India’s most powerful conglomerates, has become a major rallying point for the farmers. Every speaker on the stage warns the farmers that big or small, if companies take over agriculture and the mandi system, they will start dictating what price they can sell their crops at.
Such fears have arosen from their experiences. Lakhs of farmers in Punjab were forced to sell potatoes and tomatoes at very low prices under contracts with Pepsi for its chips and ketchup businesses before the bills were passed in September. What more, the potatoes destroyed land fertility. Farmers at protest site claim that the agri-business corporation always paid much lower prices than those agreed upon and also that the defaulted payments stretch into several instalments with long gaps in between.
Farmers in Brazil, Mexico, and Peru who unknowingly entered agreements for the supply of bananas, maize, and soyabean to major MNCs like Walmart and Cargill underwent similar experiences. Small farmers and farm workers have been agitating against unfair pricing systems practiced by these agri-business corporations in the past week.
Wire Network recently used the government’s price information system Agmarknet to estimate that farmers, on average, were denied at least Rs 1,881 crore by having to sell their produce below the MSP in October and November, soon after enactment of controversial agri-marketing laws.
The state of mandis has been degrading off late and the prices of farm produce are falling, a mere two months after the enactment of the controversial marketing act.
According to Agmark Data, in Bihar, Andhra Pradesh and Telangana, the farmers are getting Rs 900 to 1,100 as against the Rs,1,800 per quintal of MSP announced by the government. If they make mandis private, the Adanis and Ambanis will buy produce at even below Rs 1,100 per quintal and prices will crash in states like Punjab and Haryana too.
Wire Network recently used the government’s price information system Agmarknet to estimate that farmers, on average, were denied at least Rs 1,881 crore by having to sell their produce below the MSP in October and November, soon after enactment of controversial agri-marketing laws. Noted Marxist economist Karl Kautsky terms this outflow of rural surplus to urban capital as ‘market price disequilibrium’. The devaluation of mandis is inherent in the new laws, and hence, there is the fall in farmers’ returns.
Successive governments have kept raising MSPs from time to time. The problem arises when the calculations of MSPs are flawed since they fail to consider the skyrocketing costs of fertilisers, diesel, tenant rent, and other inputs.
Therefore, various farmer organisations are demanding MSPs for all crops and the clause to make it payable to farmers by any buyer should be legally enshrined in law.
Successive governments have kept raising MSPs from time to time. The problem arises when the calculations of MSPs are flawed since they fail to consider the skyrocketing costs of fertilisers, diesel, tenant rent, and other inputs.
Besides, the cultivation costs are calculated based on 2006 rates, totally overlooking the present costs. Moreover, the current MSPs, though claimed to be following the Prof Swaminathan Commission’s recommendations, in reality, do not take into account the current cost of cultivation, family labour, and tenancy rent. The farmers’ organisations are hence demanding the calculation of MSPs in true spirit of the formula suggested by Prof Swaminathan Commission. (IPA Service)
