The three now-repealed agriculture reforms (Farm Laws) aimed to modernise the sector by reducing dependency on middlemen. The Modi government’s visionary step would have directly benefited the farmers. However, the ambitious move was forced away from reality as the “farmer leaders” claimed it would undermine the traditional mandi system during the first farmer protest. The government of India asserted that the reforms would empower the farmers. It ensured they would receive fair prices for the products, but the protesting farmers did not budge and forced the government to withdraw the laws.
One of the now-repealed acts was the Farmers’ Produce Trade and Commerce (Promotion and Facilitation) Act or FPTC Act. The government of India enacted it to give farmers the freedom to sell farm produce anywhere in the country, within APMC mandis or outside them. It also allowed the setting up of an electronic platform to sell and purchase farm produce. There was a provision to prescribe modalities for registering traders and trade transactions in trade areas. In short, it would help the farmers by providing them with a broader market without forcing them to sell the produce in AMPC mandis. Interestingly, in case the system did not work as intended, there also was a provision for government intervention. However, the farmer unions claimed that the government planned to destroy the NDI system.
After forcing the government to backtrack the farm laws which were meant to protect farmers from the exploitation of middlemen at Mandis during farmer protest 1.0, the farmers are again on the streets, claiming that 87% of the product is “exploited” at the Mandis. The same Mandis that the farmers aimed to protect during the previous protests caused thousands of crores of rupees worth of losses to the businesses in and around Punjab, Haryana, and Uttar Pradesh.
It is pertinent to note that as during the first Farmer protest, this time around as well, the majority of the so-called farmers protesting are those from Punjab, not from the rest of the country. Further, it is also pertinent to note that several nefarious elements in these protests have not only raised demands for Khalistan but also turned violent attacking police officials.
In a press conference by the farmer leaders during the protest on 25th February, union leader Jagjeet Singh Dallewal and others voiced concerns over the World Trade Organisation’s policies that bar the participating countries from giving subsidies beyond certain levels. Notably, the Modi government has been steadfast in defending India’s agriculture policies on the international stage, particularly when it comes to WTO. However, the farmer leaders believe India’s agriculture sector should not be part of the WTO. One of their main demands is that India withdraw its agriculture sector from the WTO.
In a statement, Dallewal said, “The policies of WTO are not favourable to Indian farmers. Without the guarantee of a minimum support price (MSP), farmers can’t survive”. While their statement reflected a broader apprehension that the global trade agreements affect the local agriculture trade, the GoI’s position at WTO has been to defend Indian farmers’ interests staunchly. The GoI has repeatedly argued against the push to eliminate MSP and subsidies considered lifelines for the agricultural community. However, there are certain limits to giving MSP, which the GoI itself cannot cross to ensure other sectors don’t get neglected while forming national policies and fund allotment.
Regarding India’s stand at WTO, the government has actively engaged in negotiation to ensure that India’s food security concerns and the rights of its farmers are not compromised. India has highlighted at WTO how its public stockholding (PSH) program has supported global food security and countered developed countries’ claims of trade distortion. India has distributed 58 million tons of rice to 800 million beneficiaries in 2021. The government secured its food security and contributed to global stability as it averted a spike in rice prices that would have adversely impacted smaller countries.
Ignoring India’s consistent stand in favour of the farmers on the international stage, the leaders of the farmer protest have demanded MSP for all 23 crops. With their demand, they have overlooked the complex economic and logistic challenges such a policy would bring to the table. Sarwan Singh Pandher, one of the frontrunners of the ongoing farmer protests, called for a legal guarantee of MSP and demanded that India exit the WTO. However, the demand reflected the heightened emotions around the farmers’ issues without considering a broader perspective of the country’s economy.
Their demands do not fully account for the implications on India’s trade relationships with other countries and economic policies. Recently, the government proposed to purchase five crops at MSP for five years if the farmers agreed to diversify the crops in Punjab. Had the farmers agreed, it would have helped the state to step away from water-intensive crops like wheat and paddy. However, the farmers rejected the proposal, claiming it “lacked clarity”.
Farmers claimed that the crops that do not have MSP are being sold at a much higher price in the market, which deserves a debate. They claimed that the farmers get exploited at the mandis and have to sell non-MSP crops at a much lower price than expected. They might be right in their statement, but it has to be argued that these farmer unions opposed GoI’s agriculture laws favouring mandis. Indian government wanted to give farmers a broader market to sell their crops at the prices they agreed to the private sector. Mandis would have continued to function as the government had promised. However, the farmers claimed the government wanted to end the Mandi system and asserted it would be against their welfare.
Farmer leaders claimed that the government of India is only buying six per cent of the total produce. On the contrary, GoI said it buys around 13 per cent of the total produce under MSP. Farmer unions demand that 100 per cent of the produce be bought under MSP, which is not feasible. It will put extensive pressure on the government, forcing it to divert the funds allotted for the other sectors to the agriculture sector.
Dallewal, in his statement, cited old reports from the 80s and 90s that should be considered obsolete. The fact is, in the past ten years, the government of India has increased MSP on two main crops, paddy and wheat. In reply to an RTI submitted by OpIndia, the GoI revealed that MSP increased from Rs 1,350 per quintal for wheat in 2013-14 to Rs 2,015 in 2022-23. Similarly, it was increased from Rs 1,345 per quintal for paddy to Rs 2,060 per quintal in 2022-23.
It shows GoI is committed to supporting farmers to every possible extent. Furthermore, the Indian government provides subsidies on seeds, fertilisers, and other products to ensure farmers get all possible support. However, all the efforts go in vain as farmer unions continue to put unrealistic demands on the table.
Interestingly, during the press conference, farmer leader Jaswinder Singh Longwal urged “supporters sitting in foreign countries” to come forward and help them fulfil their demands. While he did not specify which “supporters” he was hinting towards going according to the history of the farmer protests, the so-called supporters cannot be good for India. In the previous protests, Mo Dhaliwal, Canadian PM Justin Trudeau, Greta Thunberg and even Rihana and porn star-turned-actor Mia Khalifa tried to meddle with India’s affairs by using their respective positions on the international stage.
