Farm Laws: Prologue- History of Indian agriculture
Following were the bills that were passed related to the farmers and our agriculture system:
Farmer's Produce Trade and Commerce( Promotion and Facilitation) bill, 2020
Farmer's (Empowerment and Protection) Agreement on Price Assurance and Farm Services bill, 2020
Essential Commodities (Amendment) Bill, 2020
But, directly getting to know about these bills won't make any sense until and unless one has a clear picture about the history of the Indian agriculture system. So let's begin from the scratch...
State of our Agriculture System until now
Agriculture in India started way back around 9000 BCE. As humanity evolved, so did agriculture. Multiple crops came into existence gradually. Until the Europeans came, India was one of the biggest exporters of many food crops and was also known as the land of spices. But, things changed after the debut of European players. They destroyed the Indian agriculture system tactically. One such instance was when our farmers were forced to grow crops like indigo on most of their land, which eventually reduced the fertility of the soil. The exploitation was such that from being an exporter of the best cotton in the world, we became a net importer of the same by the time of our independence. And similar was the case for most of the crops which our farmers grew.
We all are aware that an economy is based on few sectors say Primary, secondary, tertiary, and a few more. And agriculture covers a major part of the primary sector. When we got our independence, approximately 76% of our population was employed in agriculture, wherein the state of our agriculture was not good. So basically, back then we were a poor agrarian economy. While we were trying hard to uplift our people during the early years of our democracy, we didn't know that we also have 3 big wars waiting ahead. The Indo-Pak war of 1947, Indo-Sino war of 1962, the Indo-Pak war of 1965, and few added famines impacted us severely. There was a time when we were in such a position that we just had few weeks of grain stocks left to feed our people. Eventually, the government had to import a huge amount of food grains from the US. It's not that we imported for the first time, but the amount in which we did, reflected the grave situation we were into. We usually borrow money for fulfilling our secondary shortages but imagine a situation when you actually have to borrow for feeding yourself and your family. Well, it was the same feel our government had back then. India has had a history that whenever something goes wrong a wave of change runs through, and something sort of this was lying ahead- the GREEN REVOLUTION.
GREEN REVOLUTION
The humiliation India faced at the international level led to the role out of the GREEN REVOLUTION backed by Mr. M.S Swaminathan(also called the father of the Indian green revolution). Under it, farmers were given High Yielding Variety(HYV) seeds for Rice and Wheat. Parallelly, the fertilizers were also brought into the picture for better and quick results for intensive production. The Ganga Yamuna belt of North and Northwest India was put onto focus as an experimental first phase of the green revolution.
The pivot of the green revolution was the system of Minimum Support Price(MSP), the acronym which has been buzzing around for some time now. The government knew that nobody would participate actively until some monetary guarantee is also promised to them. That's where MSP helped. MSPs are an assurance that the government will intervene if market rates fall below that threshold, thereby helping avoid distress sales. It is nothing but a minimum assured price which the farmer would get for its crop no matter what. Farmers could avail MSP, only when they sold their crops at the Agricultural Produce Market Committees (APMCs) where a particular amount of tax was also charged for the sell-off. The first crop for which MSP was fixed was wheat at Rs. 54 per quintal. Gradually, more crops were added to the list of MSP. Few years down the line, the government got the results that it expected. The production went up and stocks were starting to rise. The income of the farmers which had been poor for ages now saw a quick rise.
But was that rise in income uniform in every part of our country? Obviously Not. The fruits of the green revolution were not replicated in other parts of the country. Therefore a divide was generated between the GR belt and the rest of the Indian states. This divide also affected the economic capacity of farmers of our country. Later on, MSP was also given on multiple crops but it wasn't that much in comparison to wheat and rice. This is a major reason that farmers of the GR belt grew rice and wheat majorly.
The Game of Fertilizers
Another ill effect that later came into realization was that the fertilizers were used more than needed. Fertilizers were a combination of NPK(Nitrogen, Phosphorus, and Potassium) in a ratio of 4:2:1 as per the requirement of Indian soil. A down-to-earth report stated that presently, the NPK ratio is 6.7:2.4:1 for most of the states whereas for Haryana and Punjab the ratio is 27.7:6.1:1 and 31.4:8:1 respectively which is very huge in comparison to the required one. The fertilizers are meant to be used in a required ratio and if they aren't, it can lead to multiple ill effects. Apparently, the states of Haryana and Punjab are on the verge of depleting their groundwater table, the soil structure has been disrupted and the soil salinity is at its peak. Yes, the fertilizers did help the farmers to grow the crops at a good rate and make themselves financially stable but not in the long run due to a lot of environmental impacts.
The MiddleMen
Whenever the farmer has harvested his/her produce, they could sell it off in the APMC system where they could avail MSP for their crop. But the system in the past few years hasn't been as simple as it looks. Most of the farmers in India are poor and marginal having landholdings less than 1-2 hectares. These poor farmers aren't able to fulfill all the infrastructure/capital requirements needed for farming (say a tractor, financing, cold storages, etc). This was the reason there came up a section of people called Middlemen AKA Intermediaries AKA Bicholiyas AKA Arhatiyas. Middlemen did the job of helping the farmer sell his/her produce in the APMC market. They would provide services to the farmers in multiple forms. Because most of the farmers were poor, they couldn't afford to buy their own tractors, trolleys, etc.
So are these middlemen illegal?
No. They are completely legal and are registered by the state government for individual APMCs. They facilitate the transaction between the farmer and the actual buyer(which could be government or even a private player).
What is the scale at which arhatiyas exist?
The middlemen exist in all the states but vary in numbers. Say if 100 people are employed in agriculture in each state, then for most of the states, middlemen range from 8-15 out of those 100 approximately whereas for haryana and Punjab, they range from 30-35.
Therefore, a significant share of agricultural income goes to the middlemen as well.
By now, you might have got a raw idea about the agriculture system in our country. Explicit focus has been given to the system of Haryana and Punjab to understand the controversy related to the farms laws. The green revolution was a boon to the indian economy, if it hadn't happened, our people would have actually starved to death. Some lacunaes did exist like the huge price parity on MSP (Rice/wheat and other crops), usage of fertilizers in inadequate ratios, etc, but one must not forget that a poor person won't think about the consequences but rather would focus on feeding the starving stomach first. Thats exactly what our government had done by kickstarting the green revolution. A system of APMCs was established which was actually needed back then. Today if the government of India has plenty of stocks of wheat and rice, it is courtsey the green revolution. Also, if the middlemen wouldn't have existed, the poor farmers produce couldn't have got the due recognition. Now, there might be more such questions like
Why the farmers of only northern states are protesting majorly?
Did middlemen destroy or enhance the mandi system?
For some, are the farm laws good? For some, are the farm laws bad?
What exactly are the provisions of the farm bills?
What is contract farming?
Where are the private players?
We will understand in detail about all the above questions in next part of the blog. Explicit focus now would be on the three laws, enough of beating around the bush. Incase, there are some other points you want the light to be thrown upon, just mention in the comment or in the contact form. Part 2 to be out soon. Until then stay tuned.
