Justice Katju, in support of farmers, said – it is necessary to give MSP law if agriculture is to be saved

Farmer’s objection to the three laws

By Justice Markandey Katju

Farmers are agitating against the three laws made recently by the Indian Parliament, at the behest of the Indian Government.

Before dealing with these laws it may be mentioned that India has a huge population of over 135 crores ( 1350 million ) people. Of these, about 60-65% are farmers, or connected with agriculture. Hence about 75 crore Indians are dependent on agriculture.

A law which affects the lives of such huge numbers needs to be carefully considered, and only made after long and wide consultations and deliberations with the farmers organisations and others, but it seems that was not done, and the laws were passed in a hurry.

But apart from that, let us consider the merits of these laws.

Supporters of these laws say that they free farmers, and enable them to sell their produce wherever they want, and to whomever they want. Hence, it is alleged, these laws benefit the farmers. But what is the truth ?

To understand this one must first know that agriculture is subsidised in almost every country in the world, even in America, the richest country, as it is unprofitable without subsidies.

Farming in India today is very different from the farming done 60-70 years ago. Then it was done by bullock carts, today it is usually done by tractors. Earlier little initial investment was required, today a huge amount of initial investment is required for fertiliser, pesticide, seed, electricity for irrigation, etc. So farming today is very different from the farming depicted in Munshi Premchand’s novel Godaan, or in the stories of Sharad Chandra Chattopadhyaya. Rural India has become semi urbanised.

The problem for the farmer now is how to get a remunerative price for his produce, because he has to invest a lot of money initially, for which he has to take loans, on which he has to pay heavy interest. Thereafter, when he has produced his crop, he is in an unequal bargaining position when it comes to selling it..

The farmer, living in a rural area, cannot obviously sell his product directly to a consumer living in the city. The way the system usually works is that a trader comes to the farm, negotiates with the farmer and buys his product, and then transports it to the city to sell it to a wholeseller. The wholeseller then sells it to a retailer, who in turn sells it to the consumer.

In this chain, the farmer is often at the mercy of the trader, and gets only a small proportion of the retail price, the rest being taken by intermediary traders ( called bichaulias ). The result was that the farmer got an unremunerative price, and since he had to borrow money from money lenders for his initial investment, he often falls into a debt trap, and this had even led to suicides ( almost 4 lacs by now in India )..

Hence a minimum support price ( MSP ) is absolutely essential if farming in India is to survive.

This MSP must be fixed by law, so that it is binding, and non compliance is punishable. The government has no doubt given oral/written assurances that the present MSP will be retained, but there are three responses to that (1) An assurance means nothing, unless it is backed up by statute. Politicians promise many things, but often renege on their promises.  (2) The Farmers Produce, Trade and Commerce ( Promotion and Facilitation ) Act, 2020 allows farmers to sell their produce outside the APMC mandis to whoever they wish. But the law does not fix MSP for such sales. Hence the farmers fear they will be at the mercy of corporates and will have to sell their produce at a low price (3) Even now only 6% of farm produce is actually sold at the MSP, according to the Shanta Kumar Report., while the Swaminathan Commission Report recommending a price to farmers of 50% above cost is largely ignored.

So the real objection of farmers to the three laws is not to what they contain, but to what they do not contain, and deliberately slur over, i.e. a statutory MSP for agricultural products, which will enable farmers to get remunerative prices for their produce. Without a statutory MSP farming is unprofitable. This is really what farmers are fighting for.

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