Farm Laws: Untangling The Controversies.

Right now the world is witnessing the largest human protest that’s happening right here in our nation’s capital. The protest is against the Three Agricultural Acts commonly referred to as Farm Bills.

Everybody knows that the protest is against the three farm laws, but do you know what these three laws are? And how they will affect the agricultural process in our nation?

We at Know Your Legal have decided to come up with an informative piece just to clear everyone’s doubts over the three laws and how they will actually work in the real world.

Let’s decode these three laws in a very simple language.

• The Farmers' Produce Trade and Commerce (Promotion and Facilitation) Act, 2020

The Farmers’ Produce Trade And Commerce (Promotion and Facilitation) Act, 2020 is an act that gives powers to the Farmers that will allow them to sell their produce through intra-state and inter-state trade. This act allows the farmers to sell their produce beyond the premises of their state’s Agricultural Produce Market Committee market yards commonly know as APMC mandis.

Prior to the New Bill, States had powers to create establish agricultural markets, popularly known as mandis. The sale of agricultural commodities could occur only in the mandis through auction. The sales process in mandis is regulated through commission agents (CAs) who mediate between the farmers and traders.

The new Act gives farmers absolute freedom to decide where they want to sell their produce, whether be it in their own state or another state outside the Mandi of its own state.

Farmers can find the right price and sell it accordingly. Also, Now the farmers are given much more freedom to let them decided where and at what suitable price they want to sell it eliminating the role of Middleman who used to exploit them to milk money at the expense of the farmers.

Under this act, the government also made an e-trading mechanism available to the farmers. This electronic system helps them to directly connect with the traders easily.

• Farmers (Empowerment and Protection) Agreement on Price Assurance and Farm Services Act, 2020

The Farmers (Empowerment and Protection) Agreement on Price Assurance and Farm Services Act, 2020 is an act that creates a framework for contract farming through an agreement between a farmer and a buyer before the production of the crops.

This act creates a mechanism that allows farmers to get in direct touch with the traders. This act also empowers the farmers to fix the price of their crop on their own and enter the contract with the trader. The contract will be safeguarded from any uncertainty regarding the fluctuation in the prices.

The trader will have to pay the full payment as agreed in the contract to the farmer with whom they entered into a contract. In any default in the payment, the farmers will have remedies available in their hand as The Act provides for a 3-level dispute settlement mechanism by the conciliation board, Sub-Divisional Magistrate, and Appellate Authority.

This act gives farmers freedom in deciding the Price for their procure and also protects them from any uncertainty that can affect their contract. Even if they fail to honour their contract like say the rain spoiled their harvest, the trader will still have to pay the full amount of the contract which was pre-decided. If the trader refuses to pay the full amount, the farmer can reach the appropriate authority for the speedy settlement of their dispute.

This Act also states that No farming agreement shall be entered into for the purpose of any transfer, including the sale, lease, and mortgage of the land or premises of the farmer. Also, any permanent structure or making any modification on the land or premises of the farmer cannot be done unless the Sponsor agrees to remove such structure or to restore the land to its original condition, at his cost, on the conclusion of the agreement or expiry of the agreement period, as the case may be.

The Act clearly states that ownership of the land shall vest with the farmer after the conclusion of the agreement or expiry of the agreement period, as the case may be. Thus this clearly debunks the rumour of Farmers losing their land to the traders or big corporate houses.

• Essential Commodities (Amendment) Act, 2020

The New amendment brought in the Essential Commodities Act has made certain changes to the previous list of the Essential Commodities. The Act deregulates the agricultural produce such as, including cereals, pulses, potatoes, onion, edible oilseeds, and oils.

These can only be regulated in extraordinary circumstances such as famine or other calamities. The Ordinance states that government regulation of stocks will be based on rising prices, and can only be imposed if there is a 100% increase in retail price (in the case of horticultural produce) and a 50% increase in retail price (in the case of non-perishable agricultural food items).

This act allows the Traders to increase their storage capacities. Such things help the farmers to improve their capabilities of storing and processing agricultural produce.

We have also seen a fear among the farmers and the protestors that the Minimum Support Price (MSP) will be abolished after these Three Laws come into action.

The first fact about this question is that the MSP was never a part of any law. So there is no question about the abolishment of MSP because of this law.

MSP has always been an executive order through which the Government sets the Minimum Support Price for 23 commodities twice every year.

Since 2009, MSP is fixed on the recommendations of the Commission for Agricultural Costs and Prices (CACP).

So according to us the question of the Government removing the MSP is meaningless as this is not even mentioned in these three farm laws. The rumour which has been doing the rounds these days that the government is removing MSP is misinformation that has been spread to mislead the farmers and the citizens.