New agriculture bill 2020 – pro or anti-farmer?

Modi’s government has faced continuous criticism for bringing in any new reform right from demonetization, Article 370, NEP, NEET, Citizenship Amendment Act to the recent ‘New agricultural bill’. Though the vision and the intention behind most of the schemes were right, the schemes were always implemented a little too quickly without knowing the public opinion. This has led to unnecessary protests along with political parties playing their cards through all possible opportunities they get.

In September 2020, Modi had announced the new farming bill that would eliminate middlemen who took a major share of the trade dealings. Let us try to understand the ‘New agriculture bill’.

What are the 3 major bills that were passed?

Promotion and Facilitation bill, 2020

This bill is also referred to as ‘contract farming’. In India, until this bill was passed, most of the large-scale farmers were in a tie-up with APMC (Agricultural Produce Market Committee). APMC(under the govt. guidance) basically sets up ‘Mandi’ or a open market, where the produce is brought in and distributed to wholesalers and retailers through auctions. This whole system comes under the state list, which means the price margin is not centralized and subjective to the state.

After this bill was passed, the Mandi layer has become optional and farmers are given the privilege to trade directly to any organization, retail outlet, a supermarket chain, or even an individual. Farmers need to get into an agreement with their consumers through a signed contract for a given period. The contracts can be extended or canceled in future.

So, what do the farmers see as an issue here?

Though the farmers get the major share of the profit with this bill, they fear that these private organizations or retailers would exploit them in course of time. The organizations might have hidden clauses in the contract which the farmers might not be aware of and lose their position eventually. Another major fear in contract farming is MSP (Minimum Support Price) guarantee.

What is MSP?

MSP is a price offered for agricultural produce by the government to buy them from the farmers to avoid any financial loss after the harvest. This scheme comes in handy when the market price for the commodity is very less.
With contract farming, the govt. / APMC intervention is cut off and the farmers fear that they might lose this privilege and must abide by the rules of the private organization. It is to be noted that, after the nationwide protest on the bill, govt. has assured that MSP would not go away. The farmers are not fully convinced though, because they fear that govt. would not keep up the promise. This fear is acceptable because, under the NDA rule, the % increase in MSP for the agricultural produce is considerably less than the UPA rule.

Agreement of Price Assurance and Farm services bill, 2020

This bill is an extension of the previous one. Until now APMC decided on the price for the produce within the state ensuring that the farmers received a fair share. APMCs also regulated licenses and market fees. With this bill, farmers could fix the price of their produce and could it trade anywhere across the country, within their state, or even make use of online trading.

What is the farmer’s fear ?

After this bill, all these formalities must be taken care by the farmer and their consumer. The farmers again fear a lot of exploitation from private organizations. The govt. has promised that the ‘Mandi’ concept is going to stay but would be an optional entity. The farmer worries that, if APMC /Mandi doesn’t become a mandate, the functioning of this unit might not be efficient. It is to be noted that small-scale farmers, even today do not rely on APMC and it is only the large-scale farmers who are affected.

The Essential Commodities (Amendment) Bill, 2020

What is the necessity of an essential commodity list?

The country maintains a specific list of national essential commodities; the list could be modified on a need basis. The price of any item in this list cannot be increased beyond the defined % margin across the country. Also, it would be illegal for supermarkets or an organization to hoard these commodities to artificially increase the demand. For eg, when the COVID pandemic was at its peak, masks, and sanitizers were included in the ‘essential commodity’ list to avoid the sale of these items at exorbitant prices exploiting the demand.

What is their fear here?

With this amendment bill, govt. has removed onion, potato, cereals, pulses, oilseeds, and edible oils from the essential commodity list. States which majorly produce the above-said commodities fear that the supermarket or the retail units would start indulging in unfair pricing of these produce and exploit the farmers by paying them less. Though farmers are not majorly concerned about this bill, they still expect fair play from the retail chains.

With all these bills being passed, the farmers were in a state of jittery and wanted their voices to be heard. The farmers from Haryana and Punjab organized a silent protest and started marching towards New Delhi, the capital city.


All about the protest

The new schemes introduced by the Modi govt. definitely puts the farmers in a better position, but the only drawback is that they should have talked to the farmer community before passing the bill. In any country, when there is a protest on such a massive scale the chances of politicizing is quite high. The agenda of this protest has changed recently due to the interference of political parties. On the flip side, videos are circulating on social media about farmers participating in the protest without the knowledge of the bills. In my opinion, these farmers should be given the benefit of doubt, because showing solidarity is also important.

Why is only Punjab and Haryana protesting?

These are the 2 states that majorly benefited by MSP and their produce includes majorly cereals, wheat, and potato which is being removed from the essential commodity list. Another important reason is most of them do large scale farming, and the role of APMC in their system is vital. With the introduction of these 3 bills, their APMC privilege is at stake. The other states, especially to the south have been into contract farming for quite some time now and remain unaffected by these amendments.

The govt. needs to sit with the farmers and get them to understand the benefits of the bill. Though, Modi’s govt. has taken the necessary round of talks, the farmers are not fully convinced. Overall, the bills seem to be pro-farmer, provided the private organizations, wholesale and retail outlets keep their contracts plain and simple.

Farmers being the backbone of India, their support and contribution are highly needed in the country’s growth. Let’s hope 2021 brings in a ray of sunshine in the lives of farmers.


4 thoughts on “New agriculture bill 2020 – pro or anti-farmer?

Add yours

  1. Farmers have long been a crucial voting block for parties, and the controversy has certainly divided the parties. Despite repeated requests from the opposition, the governing Bharatiya Janata Party (BJP) refused to extend the debate over the bill to the next day, or refer it to a special committee, where members could discuss it and refine it further.


    1. Thanks for your comment. As to my knowledge, the BJP did try to have a round of talks but looks like the farmers are not entirely convinced. Wouldn’t blame them either , because we all know what happens if corporate companies get in the way.


  2. But beyond the political fracas, the bills have also split opinions – while Prime Minister Narendra Modi called the reforms a watershed moment for Indian agriculture, opposition parties have termed them anti-farmer and likened them to a death warrant . Angry and worried farmer groups see them as unfair and exploitative. Pro-reform economists have largely welcomed the move, saying the new laws will help improve farm incomes, attract investment and technology, and increase productivity.


    1. There could be clauses in the bill that the farmers do not agree with, and that needs to be talked out. But expecting the whole farm bill to be withdrawn is not right. There are many states that have been operating on the new bill already and are not exploited. Maybe the farmer needs to get for one round of talking instead of continuing the protests. This is my humble opinion. Farmers being the backbone of the country, it definitely makes me feel bad that they are protesting for so long though. Hope things settle down soon. Thank you so much for stopping by!


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