Government vs. Farmers: What Experts Think About New Farm Laws | India News
The government says the new laws are part of much-needed reforms in the agricultural sector that will improve farmers’ lives in the long run. However, the government said it is ready to make amendments to address genuine farmers’ concerns, but has ruled out repeal of the new laws.
Several experts think that farm laws are a step in the right direction. However, there are many others who do not support the new laws.
‘Beneficial laws, but great communication failure by the Center’
Ashok Gulati, former member of the Prime Minister’s Economic Advisory Council
Prominent agricultural economist Ashok Gulati, who was a member of the Prime Minister’s Economic Advisory Council from 1999 to 2001, says that all three agricultural laws will benefit farmers. However, he believes there has been a major communication failure by the Center to explain to farmers how these laws could help them. Political parties and social activists, he says, have exploited this communication gap and launched a disinformation campaign.
Gulati feels that Punjab farmers, who are at the center of this turmoil, should diversify their production rather than protest the MSP in wheat and rice.
He says: “For the past 50 years, farmers in Punjab are largely producing wheat and rice and then selling it to the government and the Food Corporation of India (FCI). Before the GST (Goods Tax) reforms and services), there was almost 14.5% in taxes, etc. in addition to the MSP, so no processor wants to buy it at mandi in these states. After the GST reforms, taxes, etc. are still at 8.5 %, which means that profit margins are slim and the brokerage cost increases. This makes Punjab wheat totally uncompetitive. Therefore, only the government can hold stocks. ”
He also noted that rice cultivation is depleting the water table by as much as 0.7 meters per year in central Punjab and the issue of unsustainable agriculture in the state is going to arise.
Why wheat from farmers in Haryana and Punjab is not competitive in the market, explains Ashok Gulati
‘Convince farmers that the opposition is misleading them’
Swaminathan S Anklesaria Aiyar, TOI columnist
Prominent commentator Swaminathan S Anklesaria Aiyar says the Modi-led government’s reforms are “eminently sensible” and the government should wait for the agitators. The Center should convince farmers that the opposition is misleading them, he says.
He believes that Punjab farmers have benefited greatly from the government’s purchase of wheat and rice, but must now be encouraged to diversify into high-value fruits, vegetables and dairy.
He blames Punjab farmers for lowering the water table by growing water-intensive crops like rice in a low-rainfall state.
Quoting Ashok Gulati, Aiyar writes: “Farmers in Punjab get annual energy subsidies of Rs 8,275 crore and fertilizer subsidies of Rs 5,000 crore, averaging Rs 1.22 lakh per farm family. In addition, they get Rs. subsidized credit and subsidies from PM Kisan at high land prices of Rs 50-100 lakh / acre Industries do not invest in Punjab because land is exorbitantly expensive.
“The average farm in India is only one hectare, so prosperity requires farmers to switch from agriculture to industry and services. But in Punjab one hectare is worth between 1.25 and 2.5 million! Rupees! They may not look like it, but the agricultural agitators surrounding Delhi are lakhpatis on annual subsidies and crorepatis on assets.
Blog – Farmers’ Agitation: Wear an Iron Fist on a Velvet Glove
‘The only dispute is which strategy to follow’
Andy Mukherjee, Bloomberg Opinion Columnist
Bloomberg columnist Andy Mukherjee agrees with the need for farm reforms, saying the only dispute is which strategy to follow. However, he fears “speculative corporations”.
Mukherjee writes: “No one doubts that for India to have a chance to get out of the lower middle income trap, agriculture must break out of its routine of less than 3% growth. The productivity of labor, land , fertilizers and water have to improve. Massive private investments must be made in storage and processing so that the country’s 2% share in world agricultural exports increases. ”
“The dispute is over which strategy to follow. Markets or organizations? That is an old dilemma, made famous by the economist Ronald Coase in 1937. Modi leans towards markets and promises to turn the entire country into a free trade zone that it will benefit 119 million farmers and 144 million farm laborers, plus their families. A large and growing number see this move as the end of institutional support from the state, which they fear will allow speculative corporations to plunge into the resulting vacuum, “he says.
Andy feels that the government did not explain the laws properly to farmers, whose fears are not “completely irrational.” He says: “A compromise solution would require consultations, something that was sadly lacking when the Modi government implemented the bills through a dubious vote in parliament in September. Even those who defend the reforms agree that both their intention as the supposed benefits should have been better explained. But it’s too late for public relations. A more tangible concession will have to be made: an additional law, perhaps. ”
Blog – Prime Minister Modi Needs One More Farm Bill to End Crisis: Bloomberg
Now I have studied the new agricultural laws of India and I realize that they are flawed and will be detrimental to farmers. Our agriculture… https://t.co/3PmhvdFXSI
– Kaushik Basu (@kaushikcbasu) 1607657642000
‘There are no drawbacks for the farmer, only significant advantages’
Arvind Panagariya, Former Vice President of Niti Aayog
Arvind Panagariya, who served as Vice President of NITI Aayog between January 2015 and August 2017, strongly supports the new farm laws. He says there are no downsides for farmers and that the positive side is “significant.”
He writes: “The purpose of the recent APMC (Agricultural Products Marketing Committee) laws enacted by the central government is to free the farmer from APMC’s freehold and allow him to sell his product directly to the highest bidder. One can understand that commission agents who They have guaranteed the revenue from the transactions of APMC and the state government, which collects sales taxes on the shipyard, especially the acquisition of grain paid for by the central government and thus the Indian taxpayer, would be upset about the reform. for the farmer, there are no disadvantages and the advantages are significant. ”
Accusing wealthy farmers in Punjab of having vested interests, he writes: “A more plausible explanation is that richer farmers, especially in Punjab, see an opportunity in the protests to obtain a legal guarantee for a lucrative minimum price of support ( MSP) in all sales, whether to the government or private agents. It is very likely that it is this intention that has led them to argue that the true intention of the government behind the reform is to eventually withdraw the hiring in MSP when in reality never such a link has existed. ”
Strongly opposing any compromise, he says that “any reform rollback will surely encourage vested interests to rise up against other reforms.”
Blog – Reversing this reform will encourage vested interests to reject all reforms.
‘The new farm laws are flawed’
Kaushik Basu, former World Bank Chief Economist and former CEA, GOI
Kaushik Basu, who served as Chief Economic Advisor to the Government of India from 2009 to 2012 during the second term of the United Progressive Alliance, feels that the new agricultural laws are flawed.
“Now I have studied India’s new agricultural laws and I realize that they are flawed and will be detrimental to farmers. Our agricultural regulation must change, but the new laws will end up serving corporate interests more than farmers. I take off. hat to the sensitivity and moral strength of Farmers of India, “he wrote sharing his thoughts on Twitter.