Opening up farm sector to corporate investors

A storm is gathering across India against three agrarian reform measures the Narendra Modi administration has pushed through Parliament. The measures were introduced through Presidential ordinances in June and July at the height of the Covid lockdown.

The Centre held no consultations with the states or farmers’ organisations before drawing up the legislative measures.

As the lockdown curbs eased, farmers in Punjab and Haryana, which had led the Green Revolution that lifted India out of perpetual food scarcity, staged protests. Haryana police used batons and water cannons against the protesters.

The Akali Dal, Punjab’s main opposition party and long-time ally of the Bharatiya Janata Party, sent messages to the Prime Minister conveying its reservations about the measures. It received no response from him.

When the government placed before Parliament bills to replace the ordinances last week, the Akali Dal pulled out its nominee in the Union Cabinet, Ms Harsimrat Kaur Badal.

The party is still a constituent of the BJP-led National Democratic Alliance but has said it will review the matter.

The Centre disingenuously presented the reform measures as part of the economic package under Modi’s Atmanirbhar Bharat Abhiyan (Self-Reliant India Mission) to counter the pandemic.

Since India is self-sufficient in most agricultural products, there was no need to bring farm reforms under a programme aimed at self-reliance. Linking the measures to the fight against Covid was a calculated attempt to obfuscate issues.

In a series of tweets, Modi hailed the measures as historic.

They would rid the farm sector of middlemen, he said. They would also provide farmers new avenues to sell their produce and increase profits but some people were trying to mislead them, he added.

Farmers’ opposition to the reforms stem from the fear that they will throw open agriculture to corporate investors whose financial resources the richest among them cannot match. Modi did not touch upon this aspect in his tweets.

One of the three new laws amended the Essential Commodities Act, a regulatory measure enacted in the 1950s, a time of severe food shortage.

That law no doubt called for re-look as the country has left food scarcity behind.

The situation demanded deregulation but the government used the opportunity to assume new regulatory powers to ease the path for corporate entities.

The other two laws are new ones.

One of them empowers the Centre to take steps to promote and facilitate inter-state trade in farm produce.

In pursuance of it, the Centre has already started work on an online platform for trade in farm products.

The measure has taken away the states’ power to regulate markets and extinguished their right to levy taxes on them. It thus gives the Centre a commanding role in all matters concerning agriculture, which the Constitution did not envisage.

The other law ostensibly aims at empowering and protecting farmers through price assurance agreements. Farmers believe it will do the very opposite by putting an end to the long-standing practice of the government fixing minimum support prices for farm products.

The new law envisages a price agreement between the seller (read farmer) and the buyer (read corporate) even before farm operations begin.

If the measure rescues the farmer from the clutches of a rapacious middleman, it goes on to throw him before an even more rapacious businessman.

By the weekend, the government was able to push all three measures through both the houses of Parliament. They are thus now a fait accompli.

The Congress, the main opposition party, raised its voice against the measures inside Parliament and outside. It cut a sorry figure when critics pointed out that it had promised legislation on the same lines in its election manifesto.

Throwing open the farm sector to corporates is a part of the globalisation programme which both the Congress and the BJP have been pursuing while in office.

Farm reforms were among the programmes on which Congress-led governments hesitated to move forward as they were sure to invite strong opposition.

Modi does not let thoughts of likely opposition hold him back. As a result, farm reform has entered the list of subjects on which he rushed ahead with unexpected results. In some, he failed to achieve the proclaimed objective. In some others, he found himself in a bind.

Items on the list include demonetisation of high-value currency notes, goods and services tax, citizenship laws and abolition of the special status of Jammu and Kashmir.