- Corporatisation of agriculture includes corporate structures controlling input cost factors like seeds, irrigation, fertilisers, electricity cost says TRS MP KR Suresh Reddy
- The existing system is a Mafia-esque, with powerful commission agents and brokers. I’ve experienced it personally. From flowers, vegetables, fruits and I am sure pulses and grains would be the same or even more as the volumes are high. I am not sure how the new laws will be effective but at least it will break the way it’s currently done, and hopefully we can rebuild a more farmer centric system says Sridhar, an agriculturist who owns 20 acres of land on the outskirts of Hyderabad
- It is middlemen who become millionaires in India while farmers are always in debt and the consumers land up paying more and more for food and commercial crops every year. These middlemen are so powerful people that they form the backbone of many parties says Ketireddy Venkata Ramana Reddy, entrepreneur and agriculturist
- Rich farmers actually don’t care, but what the government is doing is very wrong too, passing laws without consulting concerned parties. However, I think corporate farming will be the thing of the future, and that is what the government is trying to do says Entrepreneur Vinay Kotimreddy, who owns farmlands in the outskirts.
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MSP explained
- The MSP is a minimum price guarantee that acts as a safety net or insurance for farmers when they sell particular crops.
- The concept of minimum support price finds no mention in any law even if it has been around for decades.
- Farmers are upset with the three farm bills because none of them mentions anything about MSP. While Prime Minister Narendra Modi and his government verbally promised farmers that the MSP system will stay, they have demanded a written promise on MSP from the government.
Thousands of farmers in Uttar Pradesh, Punjab and Haryana are protesting against the recently passed Farm Bills 2020, which according to the central government lay the framework for allowing farmers to sell produce directly to corporates.
However, the farmers are unhappy with the provisions of these Bills as they fear once the bills become the law, they won’t get the minimum support price (MSP) they’ve been demanding from the government for months. In fact, the proposed legislation does not specify any method of determining the “guaranteed price” farmers can get from their produce.
As the result of the above bills, mandis, where farmers have been selling their produce until now, will cease to function. Worse, the farmers fear that with big private players entering the scenes, the latter will dictate prices of their farm produce.
Meddling with the middleman
However, according to the 70th round of the National Sample Survey (NSS), the protests are engineered by commission agents or dalals in the Agricultural Produce Market Committee (APMC) mandis, who stand to lose Rs 1500 crore a year in commissions, as also rich farmers who benefit from the MSP regime.
Sridhar, an agriculturist who owns 20 acres of land on the outskirts of Hyderabad is critical of the protests. “The existing system is a Mafia-esque, with powerful commission agents and brokers. I’ve experienced it personally. From flowers, vegetables, fruits and I am sure pulses and grains would be the same or even more as the volumes are high. I am not sure how the new laws will be effective but at least it will break the way it’s currently done, and hopefully we can rebuild a more farmer centric system,” says Sridhar.
Fruits of labour
Agriculture Reforms are happening after 74 years of independence. First time farmers will be free from the clutches of middlemen and dalals, feels Ketireddy Venkata Ramana Reddy, entrepreneur and agriculturist, who owns lands in Shameerpet.
“It is middlemen who become millionaires in India while farmers are always in debt and the consumers land up paying more and more for food and commercial crops every year. These middlemen are so powerful people that they form the backbone of many parties like NCP, Akalis, Punjab congress, and many other regional parties. Hence no one tried to tamper with Agriculture Market Reforms. Once when Indira Gandhi was told to control these middlemen, she quipped back “Should we stop contesting elections!!” Many of my family members and relatives are in controlling positions in APMCs and they are all crorepatis. Many of my family members and relatives are farmers and I have always seen them struggle in their lives,” says Venkata Ramana Reddy.
Will truly transform India
Has the democracy truly reached agriculture and farmers. Farmers will be apprehensive. “They say MSP will go and hence it is a loss. The government will continue MSP and mark my words after a few years no one will need MSP as farmers will be selling to the best market and making more money than MSP. They say big corporations will monopolise and control farming. Same was told when GM, Ford, Toyota, and Honda came or when McDonald’s or KFC came. But the fact is GM ran away from India and Maruti Motors controls 51 percent market share and Honda has 3 percent. The same way Market forces and proper Regulations will never let someone control the whole farming,” adds Venkata Ramana.
“Gentlemen” farmers
It’s interesting to note that an average Indian farmer owns less than 2 acres (0.8 hectares) in land and most struggle to eat two meals a day, whereas rich farmers, better described as ‘gentlemen farmers,’ own close to 100 acres, with food grown on the land they own.
With the new laws allowing market forces to venture freely into the farm sector in India, which is currently heavily regulated by the government, one would wonder if these ‘gentlemen farmers’ will also get affected.
Entrepreneur Vinay Kotimreddy, who owns farmlands in the outskirts of the city, shares a mixed perspective. “Rich farmers actually don’t care, but what the government is doing is very wrong too, passing laws without consulting concerned parties. However, I think corporate farming will be the thing of the future, and that is what the government is trying to do,” he adds.
Is it corporatisation or democratisation?
Some commentators also believe that eighty percent of Indian farmers own less than two hectares of land and that these can become more productive through scientific methods and by growing high-value crops. “But all that requires the infusion of capital and technology. And there are farmers who are neither on this side nor on that but who are struggling as they cannot get incentives from the government as their land is more than 2 acres. And on the tax side, there is no other income apart from agriculture,” points out Sridhar.
That being said, a small, organised and well-funded group of rich farmers are still supposedly getting away with paying no tax at all in view of the government’s lack of will to consider an agricultural income tax. “The government can look into bringing them into tax payable separately,” reasons K R Suresh Reddy, MP.
He further points out that the farm bills are an act of aggression by corporate lobbyists working in government institutions. “Corporatisation of agriculture includes corporate structures controlling input cost factors like seeds, irrigation, fertilisers, electricity cost,” he cautions.
