Farmers Protest

Farmers' unions, the Kisan Mazdoor Morcha (KMM) and the Samyukta Kisan Morcha (SKM), have called for a protest in Punjab to reagitate issues from the original protest two years ago. The protest in 2024 differs significantly from the yearlong agitation of 2020-21, which aimed to force the central government to roll back its agricultural reforms agenda. The main demands this time include a law guaranteeing Minimum Support Price (MSP) for all crops and the determination of crop prices in accordance with the Dr M S Swaminathan Commission’s report. Other demands include full debt waiver for farmers and laborers, implementation of the Land Acquisition Act of 2013, punishment for the October 2021 Lakhimpur Kheri killings, withdrawal from the World Trade Organization, pensions for farmers and farm laborers, compensation for farmers who died during the Delhi protest, scrapping the Electricity Amendment Bill 2020, 200 days of employment under MGNREGA per year, daily wage of Rs 700, and a National Commission for spices.

The Indian government released model Farm Acts in 2017 to initiate reforms in the agricultural sector. However, several reforms were not implemented by the states. In June 2020, the central government promulgated three ordinances, which were assented to by the President in September 2020. Farmers in Punjab, Haryana, and other states protested against the acts, and some states also opposed the new legislation. The Kerala legislative assembly passed a resolution against the farm reforms and sought their withdrawal. The Supreme Court stayed the implementation of the Farm Acts 2020 and constituted a four-member committee to make recommendations within two months. The Farmers' Produce Trade and Commerce (Promotion and Facilitation) Act allows farmers to sell their farm produce outside Agriculture Produce Market Committees (APMCs). The Farmers (Empowerment and Protection) Agreement of Price Assurance and Farm Services Act allows farmers to do contract farming and market their produce freely. The Essential Commodities (Amendment) Act frees items like foodgrains, pulses, edible oils, and onion for trade except in extraordinary situations. These laws faced unprecedented protests by farmers at Delhi borders for over a year, which were eventually withdrawn in 2021.

Over 250 Punjabi farmers' unions have marched to Delhi, demanding a legal guarantee of minimum support price (MSP). The protest, coordinated by the Kisan Mazdoor Morcha (KMM) and the Samyukta Kisan Morcha (non-political), aims to remind the Prime Minister of promises made two years ago. The protest differs significantly from the yearlong agitation of 2020-21, which aimed to force the central government to rescind its agricultural reforms agenda. The Delhi Police has imposed Section 144 across these regions where the farmers are entering. These areas have been heavily barricaded.

• A law guaranteeing MSP for all crops and setting crop prices in conformity with the report of the Dr. M. S. Swaminathan Commission are the two main demands in the farmers' 12-point agenda.
• Key demands are:
  • farmers and laborers are fully exempt from debt;
  • the Land purchase Act of 2013's implementation, which stipulates that compensation would be four times the collector rate and that farmers must provide written approval before purchase;
  • Penalties for those who carried out the October 2021 killings in Lakhimpur Kheri;
  • Stop all free trade agreements and withdraw India from the World Trade Organization (WTO);
  • Pensions for laborers and farmers alike;
  • Compensation, including a job for one family member, for farmers who lost their lives during the demonstration in Delhi;
  • 200 days (rather than 100) of MGNREGA employment per year, a Rs. 700 daily salary, and the program's connection to farming;
  • National Committee for Spices, including turmeric and chiles, etc.

• A committee on MSP was formed by the Indian government in July 2022, following the repeal of the three agriculture legislation. Its objectives were to deliberate on cropping patterns, promote zero-budget natural farming, and talk about MSP. Since its formation, this committee has not yet submitted a report.
• Ministers from the Cabinet and heads of farmer unions recently met, and the administration proposed to form a new committee of members from the ministries of agriculture, rural development, and animal husbandry.
• The demand for MSP for all crops from farmers would be handled by this committee. The administration committed to having regular meetings and establishing a work plan for this new group.

The governments have been unwilling to provide MSP with a legal guarantee for a number of reasons:

• Excessive Government Subsidy Burden: The government's current MSP system results in a growing fiscal deficit in the yearly budget due to rising food prices.
• Foodgrain Management: If the government had to buy, store, and sell a lot of produce because there were no purchasers ready to pay the MSP, it would not have the physical means to do so.
• Steady Rise in MSPs: Increasing purchasing indicates that Food Corporation of India's (FCI) godowns are full, and increasing MSP indicates that FCI is unable to make a profit on its stock sales in the foreign market.
• Sale Outside of APMC: The majority of sales of crops that fall under MSP do not take place within APMCs. Thus, neither the seller nor the buyer are listed.
  • There is no way to ensure the MSP for these transactions. Agricultural Produce Marketing Committees (APMCs) do not have jurisdiction over village traders, who purchase produce from a large number of small and marginal farmers.

• Direct Benefit Transfer (DBT): The experts advise against depending exclusively on MSP and instead recommending direct payments to farmers. Farmers are able to secure a steady income regardless of market conditions in this way.
  • Instead of only securing pricing for certain crops, the larger issue of farmers' financial insufficiency is being addressed.
• Methods of DBT:-
  • Paying farmers directly with cash is one way to support them financially and augment their income.
    • A revenue-neutral expansion of the PM KISAN scheme might involve the government implementing the whole price support package, fertilizer subsidy, and considerably greater PM-KISAN payments to farmers.
    • Farmers are currently given direct cash payments of Rs 6000 annually under this plan.
  • Insurance Schemes:
    • The introduction of insurance plans that compensate farmers for revenue losses brought on by unfavorable weather, crop failure, or market volatility.
    • Providing grants or subsidies to encourage the adoption of technology, agricultural supplies, equipment, and diversification into higher-value crops or alternate sources of income.
  • Rate-Difference Payment: Governments may also think about covering the price differential that exists between the MSP and the farmers' selling price.
    • This option has been tested in Madhya Pradesh and Haryana as part of the Bhavantar Bharpai Yojana (price-difference compensation plan).
    • Farmers were compensated by the state government under the MP's 'Bhavantar Bhugtan Yojana' for the difference between the MSP and average market prices for their crops. If farmers had to sell their produce below MSP on the open market, they were compensated.

• Market accessibility:
  • Farmers fear that WTO rules and Free Trade Agreement will boost competition from lower-priced agricultural imports, undercutting home prices and hurting regional farmers.
  • Small and medium sized farmers believed that these agreements favor giant agribusinesses and multidimensional enterprises over them.
• Imported Products:
  • This Agreement causes floods of agricultural products from the other countries that have received subsidies, which can drive down prices for commodities grown locally by flooding the home market.
  • Indian farmers may find it challenging to compete and maintain their livelihoods as a result.
• Effect on Farming Practices:
  • International Trade agreements also impose norms or laws on agriculture practices, which make them burdensome and incompatible with customs of Indian Farmers.
  • The usages of pesticides, HYV genetically modified seeds, and environmental norms are a few examples of such restriction.
• Sovereignty and Autonomy:
  • For some Farmers, the best option to restore sovereignty and control over India’s agricultural policies is to withdraw from the WTO and Freeze free trade agreements.
  • They contend that these kinds of agreements restrict the government’s capacity to carry out measures that give small- scale farmers interests top priority and guarantee the population’s access to food.

• Methodology and Recommendations of the CACP:
  • The A2+FL formula, which only takes into account paid-out expenses and the imputed value of family labor, is the basis on which the Commission on Agricultural expenses & Prices (CACP) recommends MSP.
  • This is not the same as the C2 formula, which takes into account extra elements like interest on fixed capital and the rental value of owned land.

• Construct Consensus: In order to ensure that farmers' income is protected, there should be ongoing discussions between the government and farmers.
• Support for Income: A number of economists contend that providing farmers with "income" assistance is preferable to "price" support. The Telangana government's Rythu Bandhu or the Center's PM-Kisan Samman Nidhi both involve sending a certain amount of money into the bank accounts of the farmers on a yearly basis.
• Representation in the Expert Committee: Punjab, Haryana, and Uttar Pradesh's lack of representation on the committee was one of the concerns raised by farmers. All stakeholders in the committee should have sufficient representation, and this is something that the government should make sure of.
• Boost the Agricultural Marketing System (APMC): The APMC has to be boosted in accordance with the nation's evolving needs in order to guarantee farmers receive a higher value for their goods at fair rates and to take advantage of both local and international markets.
• The National Commission for Farmers advocated the establishment of State Farmers Commissions. To guarantee a responsive government to farmers' issues, a state-level Farmers' Commission representing farmers should be established in every state.
• Improvement of Agricultural Infrastructure: There is an urgent need for general improvements to the agricultural infrastructure. Improved storage and logistics facilities as well as up-to-date weather and market information should be made available to farmers. They will then be able to make an informed choice.

Agrarian reforms are long overdue and should eventually result in farmers receiving more compensation, similar to the economic expansion that India saw with the implementation of the New Economic Policy in 1991. But, in order to address the farmers' legitimate concerns, the government must inform them of its sincere intentions and make necessary modifications. Considering that agriculture is India's mainstay for employment, any changes must be made democratically, with input from all relevant parties.

At the same time, analysts have projected the role of states, which may serve as an alternative platform for debate and can be utilized to fight for reforms that are more appropriate for local politics and socioeconomic realities. The list of crops eligible for MSP support might be gradually expanded by the government in order to promote crop diversity and lessen the dominance of rice and wheat. This will provide farmers additional options and encourage the production of crops that meet consumer demand. We can also move to DBT to assuage subsidy issues and become WTO compliant while also giving freedom to our farmers to go beyond the MSP crops.

A balanced strategy that takes into account both the concerns of farmers and the larger economic ramifications is needed to address the MSP issue. A fair and transparent process for deciding MSP, along with a review of the MSP calculation technique, could help allay some of the worries expressed by farmers.