Centre V/S State In India Part 2: Farm Bills

Centre V/S State In India Part 2: Farm Bills

Recent Farm Bills passed by the Government have opened arena for a Centre vs State tussle, as the state of Punjab has come up with its own Bills to nullify the ones passed in the Parliament.

Crux of the Matter

Punjab Farm Bills
3 Farm bills were recently passed in Punjab, governed by the Congress party. These Bills would nullify the Farm Laws recently passed by the Central Government to some extent.

Interestingly, the Shiromani Akali Dal (SAD) rejected the Bill. SAD was an ally of the BJP before separating over disagreements in the Farm Laws.

Centre Laws
Central Government recently passed Farm Laws which:

  • Allow farmers to sell outside the state-regulated Agricultural Produce Market Committee (APMC).
  • Allow stockpiling of several crops.
  • No provision of Minimum Support Price (MSP) for farmers selling outside APMC mandis to private traders.

For more comprehensive coverage of the Farm Laws read: New Farm Bills In India: Features And Impact

So What Did Punjab Do?
Punjab has passed Bills to nullify the Central laws in the state with following provisions:

  • 3 years imprisonment for traders for “compelling” farmers to sell below the MSP.
  • Private traders would now come under APMC regulations and would have to pay market fees.
  • Punjab Govt may impose limits on stockpiling and decide what comes in the “essential” category.

Issues
The Bills require the approval of the Governor. Subhash Kashyap, former Secretary General of Lok Sabha, has claimed that the Governor has the following options with the Bills:

  • Give or withhold assent.
  • Send bill for consideration to the President of India, who may approve or reject, or even withhold the Bills “indefinitely”.

Kashyap claimed that approval from the Governor is “unlikely”. Moreover, the Bills have been criticized as the Minimum Support Price ‘legal protection’ is applicable only for Wheat and Paddy crops.

We understand these bills require assent from the President to take shape of laws, and we are not very sure about that. We may have to approach the Supreme Court to implement the bills passed by the state assembly.

Bharat Bhushan Ashu, Food And Civil Supplies Minister, Punjab
Curiopedia
  • P. Ayyakannu is a lawyer and farmer born in Tamil Nadu. He is famously known widely throughout India for his protest against the central government at New Delhi, demanding the agricultural loan in cooperative banks to be abandoned. 
  • The breadbasket of a country is a region which, because of the richness of the soil and/or advantageous climate, produces large quantities of wheat or other grain. The Punjab and Haryana regions are considered the breadbaskets of India.
  • CBI is exempted from the provisions of the Right to Information Act. This exemption was granted by the government in 2011 on the basis of national security. It was criticized by the Central Information Commission and RTI activists, who said the blanket exemption violated the letter and intent of the RTI Act.

Israel Envoy Praises India’s Farm Bills

Israel Envoy Praises India's Farm Bills

As the Israel Envoy to India praised India’s new Farm Bills, let us look at the history of India-Israel relations from non-recognition to ‘close ties’.

Crux of the Matter

Praise From Israel
Ron Malka, the envoy of Israel to India, praised the Farm Bills recently passed in India. He claimed that opening the Indian farm market would ensure change in 2 steps:

  • 1st Phase: Enables farmers to “get what they deserve”.
  • 2nd Phase: Enhances “’supply-demand coordination”.

He predicted a better efficiency in agriculture and “better crops” for consumers in the long run for India. Providing an example of his own country, he said that Israel has “no middlemen” and has “very advanced digital platforms” to directly connect farmers with customers.

Malka also claimed that Israel’s “most successful collaboration on agriculture is with India”. He notified about “29 centres of excellence in agriculture” in India, which have trained 1,47,000 Indian farmers in 1 year.

Malka announced that a new Covid-19 testing kit, jointly developed by India and Israel, would be available in “a matter of days”. It is expected to show results within 30 seconds. Moreover, Uttar Pradesh and Israel signed a water-management agreement in August 2020. The agreement would aid the Bundelkhand region with the Israeli water-model.

India-Israel Relations In 20th Century

Till 1950s
India backed Palestine and did not share cordial relations with Israel earlier.

  • 1947: India voted against the partition of Palestine from which Israel was formed.
  • 1949: India voted against the admission of Israel in the United Nations (UN), though Israel was admitted as the majority of the nations backed it.
  • 1950: India finally recognized the state of Israel after 60+ countries did it. However, it didn’t establish official diplomatic relations. PM Nehru said that “we refrained from recognizing Israel because of our desire not to offend the sentiments of our friends in the Arab countries”.

1960s – 1970s

  • 1962: Israel provided arms and strategic information to India amidst the Indo-China war.
  • 1965: Israel provided arms to India amidst its war with Pakistan, when both the US and the Soviet refused to aid India.
  • 1971: War erupted between India and Pakistan over Bangladesh’s separation. Israel provided arms to India and the ‘Mukti Bahini’ which defeated Pakistan and created Bangladesh. However, Indian PM Indira Gandhi refused to establish official relations with Israel even after the war.

To know the recent history of India and Israel, check this story out: India-Israel Relations Since 1990s

Curiopedia
  • Israel is a world leader in the invention of new technologies. Some of the technologies it has produced are: the cell phone, voice mail technology, the first antivirus software, the Pentium MMX chip technology and most of the Window NT operating system.
  • The Camp David Accords were a pair of political agreements signed by Egyptian President Anwar Sadat and Israeli Prime Minister Menachem Begin on 17 September 1978. Due to the agreement, Sadat and Begin received the shared 1978 Nobel Peace Prize
  • As a personal gesture, Israel named a new type of Crysthanamum flower after PM Narendra Modi. The name “chrysanthemum” is derived from the Ancient Greek word for Gold Flower.

New Farm Bills In India: Features And Impact

New Farm Bills In India: Features And Impact

With the Rajya Sabha passing two major bills related to farmers and their business, let us look at the salient features of the farm bills while noting their impact on the farmers.

Crux of the Matter

Passed Bills
On 20 September, 2020, the Rajya Sabha passed two farm bills passed in the Lok Sabha previously –

  • 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.

On 21 September, the Essential Commodities (Amendment) Bill was to be put in the Rajya Sabha.

Features Of The New Bills

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

  • Allows farmers to sell their produce to buyers other than ‘mandis’ (market) regulated by Agricultural Produce Market Committee (APMC) – farmers can sell to private buyers too.
  • Adds the option of selling outside the state of the farmer.
  • Prohibits state governments from imposing market fee on “farmers, traders, and electronic trading platforms” for trading outside the ‘trade area’ or with a buyer other than the mandi.

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

  • Allows agreement between farmers and buyers before the production.
  • Fixes a price before the production for the produce to be sold at.

The Essential Commodities (Amendment) Bill

  • Removes cereals, pulses, onion, potatoes, etc from the “list of essential commodities”.
  • Removes restrictions on storing – earlier, traders could be prosecuted for “hoarding” essential items.
  • Government intervention to occur only in cases of famine, war, or any extraordinary calamity.

Impact

  • Farmers would be freed from the middlemen who would lose ‘commission fees’ if the former move outside APMC.
  • Marketing prices would be reduced for the farmers.
  • The risk of market volatility would be transferred from farmers to buyers and sponsors.
  • Contract farming with a proper legal network would increase.

To put in perspective, 86% of “land holdings” by farmers are of less than 2 hectares according to Agriculture Census (2015-16). Consequently, these farmers with small lands end up as ‘net buyers’ of food and essential crops. Moreover, the MSP hikes distress these farmers the most.

  • Farmers would have more options for selling, now having a provision to sell to the private sector if better price is offered.
  • Farmers would be free from ‘mandi tax’ levied by the state.
  • APMC mandis would not be shut, with only an option of private sector being added for farmers.

PM Modi clarified on Twitter that the Minimum Support Price (MSP) and the Government Procurement would continue.

MSP – minimum price for a crop fixed by the Government before farming season – ensures that farmers don’t face loss in case of drastic price decline. The MSP is applicable to APMC only.

Also Read: New Farm Bills In India: Opposition And Reactions

Curiopedia
  • A price floor is a government- or group-imposed price control or limit on how low a price can be charged for a product, good, commodity, or service. Governments use price floors to keep certain prices from going too low. 
  • eNAM is an online trading platform for agricultural commodities in India. The market facilitates farmers, traders and buyers with online trading in commodities. The market transactions stood at ₹36,200 crores by January 2018, mostly intra-market. 
  • Jai Jawaan Jai Kisaan was a slogan by the second Prime Minister of India, Lal Bahadur Shastri, in 1965 at a public gathering in Delhi. In 2015, a film based on Shastri’s life was released which was named after this slogan.

New Farm Bills In India: Opposition And Reactions

New Farm Bills In India: Opposition And Reactions

The new farm bills passed in the Rajya Sabha have generated differing reactions to them, with opposition ranging from creating a ruckus in the Parliament to particular members supporting it.

To know about these bills, what changes they bring, and what can be their impact, immediate and long-term, read this story: New Farm Bills In India: Features And Impact

Crux of the Matter

Opposition Points
Following are the major points raised by the Opposition leaders against the new bills:

  • State Governments would lose revenue.
  • MSP is not applicable on private buyers, which might make farmers prone to corporate monopoly.
  • The move would mainly benefit the “Big Corporations” instead of farmers.
  • Lack of storage capacities (like cold storage), transport capacities, and lack of awareness regarding laws and bargain might bring more loss for farmers when dealing with corporations.

One such example used by the opposing faction was the recent ban on exporting Onion as the prices soared in the country. Critics have claimed that such moves in the future would affect farmers even more with private sector involvement.

Reactions

  • Harsimrat Kaur Badal of the Shiromani Akali Dal (SAD), one of the allies of the BJP, resigned from the post of Food Processing Industries Minister.
  • Ruckus was created in the Parliament as Rajya Sabha Deputy Chairman Harivansh extended the time of the House beyond 1 PM till a decision on the bill was reached, against which the Opposition demanded to adjourn the House on the scheduled time.
    Opposition leaders then broke the mics (including that of the Chairman) and threw papers in the air. 8 MPs including Derek O’Brien from TMC have been suspended for 1 week for the ruckus.
  • Farmer groups from Haryana, Punjab, and Maharashtra have been protesting against the Bills since weeks.
  • States like Bihar and Kerala have not implemented APMC.

Congress And Mixed Reaction
Congress has been a leading opponent of the farm bills. Spokesperson of the party Jaiveer Shergill claimed that “the Congress manifesto never promoted the idea of abolition of the Minimum Support Price (MSP), unlike the present bills passed by the BJP”.

However, suspended Congress leader Sanjay Jha favoured the Bills. In his tweet, Jha claimed that the “Congress Manifesto for 2019 Lok Sabha elections… had proposed abolition of APMC Act and making agricultural produce free from restrictions. This is what the Modi government has done in the farmer’s bills”.

Curiopedia
  • price floor is a government- or group-imposed price control or limit on how low a price can be charged for a product, good, commodity, or service. Governments use price floors to keep certain prices from going too low. 
  • eNAM is an online trading platform for agricultural commodities in India. The market facilitates farmers, traders and buyers with online trading in commodities. The market transactions stood at ₹36,200 crores by January 2018, mostly intra-market. 
  • Jai Jawaan Jai Kisaan was a slogan by the second Prime Minister of India, Lal Bahadur Shastri, in 1965 at a public gathering in Delhi. In 2015, a film based on Shastri’s life was released which was named after this slogan.