Bills of Agriculture Marketing Reforms Will Enhance Farm Income

On the background of COVID 19 , GOI has taken a series of measures to bring the paralysed economy due to lockdown on resilience mode through various policy decisions and economical packages. Being greenfield and largest employment generating sector, agriculture was boosted through various schemes and programs along with agriculture marketing reforms promulgated through ordinances.

Amidst opposition, Loksabha has passed the Farmers’ Produce Trade and Commerce (Promotion and Facilitation ) Bill, 2020 and The Farmers ( Empowerment and Protection ) Agreement on Price Assurance and Farm Services Bill, 2020 which were promulgated by President of India in the month of June. These bills has to undergo litmus test of the Rajya Sabha but it seems easier due to majority of the ruling party in upper house. Thus, Farm sector has is awaiting the formalities of the Law in process for agriculture marketing reforms.
These bills are in real sense to be seen beyond opposition and opportunities should be explored by the stakeholders.

Firstly, Farmers agreement on Price Assurance & farm services Bill has provisions for season specific to long term agreements which unlock the opportunities for the contract farming through strengthening backward and forward linkages. This bill has highlighted the value chain development & interlinkages with concerned stakeholders. These will boast the micro finance, microcredit business along with development of farmers common service centres at farm gate level and custom hiring centres for mechanisation. This bill will explore untapped opportunities of farm services through public private partnership for agriculture infrastructure development. It will also boost the corporate sector to enter business of commodity procurement & warehousing.

Secondly, Farmers produce trade and commerce (Facilitation & promotion) Bill has pitched for the creation of alternate marketing system. As, present system is monopolised by the APMCs, chances of farmers exploitation was more due to lack of transparency and efficiency in the supply chain operations. This bill boosts the inter & Intra State trade which will bring investment in setting up market infrastructure and commodity markets by bridging the surplus and deficient production zones. It also created opportunities for various tech companies to build electronic trading and transaction platform for Agriculture commodities. This idea will create an ecosystem of virtual agriculture markets. Through efficient market information and management systems, there will be robust and standardised price discovery mechanism. Simultaneously, both bills have mentioned about exemption of farm produce from the state acts and Essential commodity acts.

However, farmers agitation in the north India are with the rumours and speculation of halting MSP procurement operations. Also, some sections are considering corporatisation of the Indian agriculture through these bills but in market driven economy it doesn’t have any merit and such thought process pulling back sector from integrated agriculture development. But, in political economy, political turmoil should not become the hinderance in reforms which are in the interest of the farmers. Central government must stand with confidence for implantation of reforms through active participation of the states. Otherwise, decision like export of onion ban discourage the spirit of long run reforms. Now it is responsibility of all the stakeholders to develop an ecosystem for doubling farm income.

(views are personal) 

*The author is Managing Director of MAHAFPC, Pune