PM Modi announces to repeal controversial farm laws; urges farmers to call off protests

"Today I have come to tell you, the whole country, that we have decided to withdraw all three agricultural laws. In the Parliament session starting later this month, we will complete the constitutional process to repeal these three agricultural laws," Modi said in an address to the nation.

Prime Minister said that we have seen the challenges of farmers very closely in our five decades of life. "When the country gave me an opportunity to serve as prime Minister in 2014, we gave top priority to agriculture development, farmer welfare. To overcome the challenges announced by the small farmers of the country, we worked all-round on seeds, insurance, markets, and savings," he said.

"Along with good quality seeds, the government also connected the farmers with facilities like neem coated urea, soil health card, micro-irrigation. Many steps were also taken for the farmers to get the right price for their produce in return for their hard work. The country has strengthened its rural market infrastructure. We not only increased the MSP but also created record government procurement centers," he said.

He said in the campaign to improve the condition of the farmers, three agricultural laws were brought into the country. "The objective was that the farmers of the country, especially small farmers, should get more strength, they should get the right price for their produce and more and more options to sell the produce. For years, farmers of the country, agricultural experts of the country, farmers' organizations of the country were continuously making this demand," he added.

Modi said that many governments had brainstormed on this in the past as well. "This time also there was discussion in Parliament, brainstorming took place and these laws were brought in every nook and corner of the country, many farmers' organizations welcomed and supported it. "But such a sacred thing, absolutely pure, matter of farmers' interest, we could not explain to some farmers despite our efforts. Agricultural economists, scientists, progressive farmers also tried their best to make them understand the importance of agricultural laws," he said.

The Farm Acts

The first farm act - "Farmers' Produce Trade and Commerce (Promotion and Facilitation) Act" which professes to "expand" scope of trade areas other than the mandis. This act is said to "free" the farmers from the "clutches" of the mandi system. It is supposed to enable the farmers to sell their produce anywhere and everywhere. This is all but a pipe dream and a potent misdirection. The only ones with the ability and means to sell "anywhere and everywhere" are the corporate agricultural firms with huge investments, delivery, and storage systems. They will be able to bring the prices down precipitously and control the entire market. Farmers will have to sell their produce at the prices dictated by these big firms. This is why the farmers all over the country are demanding that MSP be codified into law for which all the prime minister can come up with is to "trust" him. If it is possible to bull-doze three new laws without any parliamentary discussion, why is it so hard to provide for MSP in the law?

Bihar is a living example of all that is wrong with the act. In 2006, Bihar abolished the APMC system. As a consequence, it saw increased price volatility and low growth in agriculture. Farmers were left to the mercy of traders and set on a race to the lowest price [3].

The second act (Farmers (Empowerment and Protection) Agreement on Price Assurance and Farm Services Act) "creates a legal framework for contract farming". In contract farming, the farmer owns the land as a mere technicality. What to grow, when to grow, and how to grow are all set by the contract. This new law creates a path to making farmers into gig workers (like Ola, Uber, etc) and will rob the independent farmer of any power and control over his/her own produce. Because of the storage/stock and yield requirements, it only benefits large farmers and is harmful to small farmers. This is evident in the case of Pepsico contract farming in Punjab [7]. Owing to the sheer scale of capital investment, corporate farming can change the very landscape of farming in certain areas (in Pepsico's example, the forced cultivation of potatoes for chips). The so-called "legal framework" is nothing but a "legal framework" for exploitation that has been carried on verbally until now.

Let us take the case of Amazon which, while amounting to just 1.6% of Indian retail sales have systematically destroyed the Indian retail sector [4] with its predatory pricing. Uber, Ola is another example where the 'free' and 'open' market all but destroyed the public transport system not to mention leave scores of auto workers in a state of despair. Time and again, we have also seen the government favoring Reliance Jio over BSNL in a deliberate matter. In the Covid-19 crisis, while our economy is in shambles, the wealth of Indian billionaires rose by over a third [6]. So, let us not be in any delusion over whom these acts will set 'free' – It is only the big corporations and monopolies that it will benefit.

The third act (Essential Commodities (Amendment) Act 2020) deregulates key food items such as cereals, pulses, potato, onion, etc as essential commodities. That means there are now no limits on stocking these items. Let us look at how these three acts help the monopoly agricultural corporation and not the farmer – The corporate firm decides which commercial crop to grow, based on the most profit it stands to make So, tobacco instead of rice, sugarcane instead of wheat, potatoes for chips instead of pulses and food grains. It gets into a contract with the farmer (act 2) and also procures 'freely' from farmers from whom it can directly procure produce at throw-away prices (act 1). As these items can be stored practically forever, the firm then creates an artificial demand by hoarding the produce in its warehouse/cold-storage. The prime minister chides us that we are living in the past century by saying that these bills are for the '21st century' and we need the new bills to move forward. If that is true, they will only let the monopolies move forward by enabling further exploitation of farmers. These laws will open up our agricultural sector not only to the domestic corporations but also to the whims and fancies of the International market. They cater to the demands and complaints of the World Trade Organization and the World Bank that India is 'pampering' its farmers with subsidies and the MSP system. In this context, the farmers' demand for MSP to be codified into law is only justified.