In this article, we will look into 3 New Agricultural Farm Bill 2020 Introduced by Government of India. Farmers are currently protesting from last few months to abolish the new farm laws introduced in the parliament of India in Sep, 2020. Since this is a very important topic from exam point of view so we will see every aspect of the newly introduced agricultural farm bills.

What is MSP ?

MSP is known as Minimum Support Price. It is basically the minimum price decided by the Government of India for few of the crops below which Farmer cannot sell their produce. Currently 22 Crops are under the MSP Regime.

What is Farm Bill 2020 ?

It is also called Indian Agriculture Acts of 2020 often referred as Farm Bills 2020 introduced in the Parliament of India in September, 2020 with a vision to double the Farmers Income by Year 2022.

What are the 3 New Agriculture Farm Bills ?

• The Farmers Produce Trade and Commerce(Promotion and Facilitation) Bill, 2020
• The Farmers (Empowerment and Protection) Agreement on Price Assurance and Farm Services Bill, 2020
• The Essential Commodities (Amendment) Bill , 2020.

The Farmers Produce Trade and Commerce(Promotion and Facilitation) Bill, 2020

This new Farm Bill allows intra-state and inter-state trade of farmers’ produce beyond the physical premises of APMC markets. State governments are prohibited from levying any market fee, cess or levy outside APMC areas. More on PRS India.

The Farmers (Empowerment and Protection) Agreement on Price Assurance and Farm Services Bill, 2020

It creates a framework for contract farming through an agreement between a farmer and a buyer prior to the production or rearing of any farm produce.  It provides for a three-level dispute settlement mechanism: the conciliation board, Sub-Divisional Magistrate and Appellate Authority. More on PRS India.

The Essential Commodities (Amendment) Bill, 2020

It allows the central government to regulate the supply of certain food items only under extraordinary circumstances (such as war and famine).  Stock limits may be imposed on agricultural produce only if there is a steep price rise. More on PRS India.

Are Farmers taking benefit of MSP(Minimum Support Price) ?

As per 2015 Shanta Kumar Committee Report, Only 6% farmers are currently taking the benefit of MSP. Rest of the Small and Marginal Farmers are still not able to take the benefit.

What is the Current Agricultural Law ?

Currently we have a system of Mandis in every state implemented through APMC(Agriculture Produce Market Committee) Act where Farmers and Traders needs to register to buy and sell the Farm Produce. It is regulated by the respective State Governments.

What are the Problems with APMC Act ?

• Increase in Price of the produce by the time it reaches from Farmer to Consumer.
• Loss of produce by atleast 12% due to long process followed in Mandi.
• APMC not able to solve the problems of Small and Marginal Farmers. It is only benefitting Large Farmers.
• Commission Agents Charges around 1.5% to 3% commission for their services.
• APMC Act became a tool to exploit the Farmers.

What are the Changes New Agricultural Law will Bring ?

• It talks about removing Middle Men or Arthiyas from Mandis.
• As per govt, new Farm laws will allow farmers to sell their produce at attractive prices.
• Farmers does not have to bear any damage or consequence in case there is a contract termination between the two party.
• Farmers are now free to store inventory which was constrained so far by stocking limits of ESCA.

Why the Farmers Protest ?

• New Agricultural Bills will put Farmers under the mercy of Corporate Industries.
• Fear of the ending of MSP.
• Fear of the closure of Mandis.

What are Suspected Problems in New Farm Bills ?

• Loss of Jobs due to closure of Mandis. For example: Punjab and Haryana together currently has around 48000 Commission Agents employed in Mandis whose job will be affected due to this new law.
• Loss of State Income due to closure of Mandis. As of 2019, India has around 6630 mandis. Closure of this much mandis will cause huge impact on State Income. Punjab alone earn around Rs 1000 crore every year from the Mandi Tax.