First, the poor farmers have no holding capacity or storage for their produces so that they can bargain for prices with the intending buyers. Secondly, farmers usually take loans from private individuals or from banks or financial institutions. They need to be repaid at right time or else the interests on loans will keep accumulating. Hence the poor farmers even make distress sales as they need money for loan repayment and for investing in the upcoming sowing season. Nitish, while repealing the APMC Act, should have thought of creating a vibrant chain of storage and cold storage capacity in cluster of villages, blocks or at district levels. He should have created a good network of rural roads. He should have imposed a penalty for any purchase done below the declared MSP.

This distress of farmers along with the problem of migrants who returned to Bihar, handling of the havoc created by recent floods and coronavirus crisis and the prevalent joblessness are being echoed in the election campaign much to the discomfort of Nitish Kumar.

Prime Minister Narendra Modi did not learn from Nitish Kumar’s experiment of repealing the state APMC Act. He, however, allowed the APMCs to stay in states. He in the name of “liberalisation” and doubling farmers’ income allowed them to sell their produces outside the APMC area. This again lacks proper strategy for implementation. True farmers can sell their produces to corporate houses or firms or to any individual. But at what prices? Will there be any gaurantee that purchases will not be done below the declared MSP? Is there any penalty for any purchases to be made below the MSPs? Is there a vibrant network of storage and cold storage capacity in the country where the farmers can store their produces and bargain with the buyer? Is there enough Farmers’ Producer Organisations (FPOs) throughout the country who can bargain with the prospective sellers? These are unanswered questions awaiting answers.

MSPs are declared for only 22 crops. The government claims that it has raised the MSPs by 150 per cent as per the recommendations of the Swaminathan panel. Purchases are done by government agencies only for two principal crops – wheat and rice or paddy at the APMCs. Pulses and onions are procured by cooperatives, by way of market intervention, only at the times when prices crash.

True there are maladies in the working of APMCs set up different states. Farmer has to sell his produces only to licensee traders. Licensee traders or middlemen are mostly money lenders who extend credit to farmers and buy back from them in exchange. Middlemen often procure from farmers below the MSP and sell at MSP or higher than the MSP. Besides there are a plethora of taxes at APMC mandis through which the state governments stand to benefit.

Agriculture is no doubt a state subject under the Constitution. Agricultural marketing is on concurrent list. It is good the central government has realised this of late. There is no problem in liberalising agricultural markets and allowing farmers to sell their produces to any prospective buyer anywhere. But the problem lies in ensuring the implementation of MSPs. Prime Minister should have thought of the farmers, the producer and not only the buyers of the produces. Farmers often suffer when prices crash and here the principle of “produce and perish” becomes a reality.

Prime Minister Modi made an open declaration of doubling farmers’ income by 2022. This can happen when he can assure “ease of doing agriculture” like he is engaged in making “ease of doing business” a reality. In the times of corona crisis and nationwide lockdown, it was agriculture sector that alone gave some hope to the ailing economy.

A high level committee headed by CEO of National Rainfed Area Authority, Ashok Dalvi way back in 2017 recommended placing agricultural marketing in Concurrent List in the Seventh Schedule of the Constitution for setting up of a common unified agricultural market in the country.

Article 307 of the Indian Constitution mandates Parliament to legislate appropriate laws and appoint an Authority for ensuring free trade in agricultural commodities across the country. Item 42 of the Union List can be used for setting up of a common unified agricultural market across the country. It is to be noted that the model APMC Act was floated after 1955, it is not protected by Constitutional provision of Art 305.

Though Article 303 and 304 talk of restrictions to be imposed, Article 301 talks of “Freedom of trade, commerce and intercourse - Subject to the other provisions of this Part, trade, commerce and intercourse throughout the territory of India shall be free." Thus the spirit of the Constitution is clear. It empowers the Parliament to legislate and thus paves the way for free trade in agricultural commodities across the country.

But the way the Modi government has liberalised agricultural trade has caused widespread resentment amongst farmers not only in Punjab and Haryana but across the country. The Constitution allows for setting up of a nationwide unified common agricultural market. It also allows for setting up of a market regulator to oversee the implementation of MSPs. If power, telecom and insurance sectors can have regulators then why cannot there be a market regulator for agricultural trade?

Setting up of a market regulator for ensuring strict implementation of MSPs will resolve the resentment of farmers. (IPA Service)