Do it yourself

 Delhi APMC’s Azadpur Mandi (wholesale market) is the largest fruit and vegetable market in Asia. Farmers and traders from across the country bring their produce to this market for selling. This Mandi is also one of the largest import and export hub for fruits and vegetables in India. A visit to this Mandi is always fascinating. From the lorry drivers travelling from all corners of India one can gather first-hand account of the socio-economic state of affairs in the country. Azadpur Mandi is an ideal reflection of socialist and secular society. One finds very rich traders & commission agents and very poor laborers together struggling to pass through filthy and narrow by-lanes of the Mandi. Hindu, Muslims and Sikhs work, eat and live together here most amicably. The social and legal issues like child labor, drugs, labor exploitation, human rights violation, labor’s dignity etc. are mostly meaningless here; and no one seems to be bothered about these “mundane” issues here. Her...

  Continuing from last week (See Farm Sector Reforms – 4 ) While announcing the famous Rs20trn economic stimulus package in May 2020, the finance minister had made the following 10 key promises for the farm sector in India. It was categorically stated that the governments sees farm sector as a key driver of overall economic growth and also a powerful engine to drive the “self-reliance” agenda. 1.     Essential Commodities Act to be amended to enable better price realization for farmers by attracting investments and making agriculture sector competitive. 2.     A central law to be enacted to provide for inter-state trade and framework for e trading of agriculture produce. 3.     The government to facilitate appropriate legal framework for an enforceable standard mechanism for predictable prices of crops at the time of sowing. 4.     Financing facility of Rs.1Lakh Cr to be provided for funding Agriculture Infrastru...

 Continuing from yesterday (See Farm Sector Reforms – 3 ) The Parliament passed The Essential Commodities (Amendment) Bill 2020. The stated objective of the amendment is to make sure that farmers get remunerative prices for their produce, and large scale private investment in agriculture related infrastructure (cold stores, warehouses and agro processing industry) could be attracted. This amendment was considered necessary to achieve the objectives of The Farmers (Empowerment and Protection) Agreement on Price Assurance and Farm Services Bill, 2020, that enables contract farming and forward contracts in agriculture produce. The Essential Commodities (Amendment) Bill 2020, basically changes the following two things: 1.     The power of central government to regulate the supply of food commodities, including cereals, pulses, potato, onions, edible oilseeds and oils etc., has been limited to the extraordinary circumstances like war, famine, extraordinary price ris...

  Continuing from yesterday (see Farm Sector Reforms – 2 ) The second piece of legislation, namely, The Farmers (Empowerment and Protection) Agreement on Price Assurance and Farm Services Bill, 2020 , primarily provides for the following four things: 1.     Forward Sale Agreement: A farmer may enter into a written forward agreement with a person to sell his produce at a predetermined price. Any such agreement shall specify (a) the price (fixed, or benchmarked with a guaranteed minimum); (b) The time of delivery; (c) place and method of delivery; and (d) quality specification for the produce. The ownership and risk of output due to vagaries of nature of otherwise, shall remain with the farmer till he offers a valid delivery to the buyer. 2.     Contract Farming: A farmer may enter into a written agreement with a person to provide farm services for predetermined fee. The service buyer shall specify the crop, quality, and other specifications,...

Continuing from yesterday ( Farm Sector Reforms ) Before commenting on the three specific agriculture sector reform related bills passed by the Parliament recently, three points need to made clear: A.     The farm sector in India is in dire need to major reforms. These reforms are not only critical for the farm sector alone, but for the overall economic growth of the country. The solution to most macro economic problems, e.g., large scale unemployment, dwindling household savings, volatile food inflation (and therefore unpredictability of inflation and interest rate trajectory); fiscal discipline of the governments etc would come through these reforms only. B.     The recent legislative changes are intended to address only two small pieces of the entire rural sector puzzle. Land reforms and social reforms are perhaps the two bigger pieces. C.     The new legislations do not seek to change the status quo materially as most the proced...