Madhya Pradesh: Marketing privatisation

Print edition : July 31, 2020

Harvesting during the nationwide lockdown in the wake of coronovirus pandemic, in Jabalpur on April 3. Photo: PTI

Farmers in Madhya Pradesh are critical of the two recent Central ordinances relating to agriculture and of Chief Minister Shivraj Singh Chouhan for not helping them in their hour of crisis.

Two recent ordinances passed by the Central government relating to agriculture have attracted criticism from farmers’ bodies across India, which fear that the move is aimed at benefitting big companies and will deprive them of the minimum support price (MSP) for their yields. Farmers in Madhya Pradesh are no exception. If procurement of their produce at a fair MSP is stopped, as the new policies apparently aim to do, farmers would be faced with a livelihood crisis.

The Farmers’ Produce Trade and Commerce (Promotion and Facilitation) Ordinance, 2020, and the Farmers (Empowerment and Protection) Agreement on Price Assurance and Farm Services Ordinance, 2020, were approved by the Union Cabinet on June 3 and promulgated by the President on June 5.

The government maintains that these ordinances are aimed at creating a conducive ecosystem for private investment in agriculture. Proponents of the ordinances say that it will promote transparent and barrier-free inter-State and intra-State trade and commerce of farmers’ produce and that they need not depend on the physical premises of markets or deemed markets.

Abhimanyu Kohar, spokesperson of the Rashtriya Kisan Mahasangh, however, says that farmers’ experiences have been starkly different. “The objective is to hand over the farm sector to the free market. Earlier, our produce was under the purview of the Agriculture Produce Marketing Committee [APMC], but now any private player can directly purchase crop from growers. The government is silent on the question of whether these private players will be mandated to follow the MSP norms,” Kohar told Frontline.

He said that farmers had suffered staggering losses because of the lockdown, and the experiences of farmers in Madhya Pradesh, where Chief Minister Shivraj Singh Chouhan was in a hurry to implement the new guidelines, showed that there would be a further erosion of fair practices in selling crops.

Rishiraj, a farmer based in Narsinghpur, said farmers had failed to get the MSP for wheat, mung bean (moong) and black gram (urad) during the lockdown. He alleged that officials in charge of the government mandis or procurement centres forced farmers to accept their terms. “Throughout the lockdown, the farmers were harassed and inconvenienced. When I went to sell black chickpeas [chana] at the mandi, they were using large strainers, so that half the crop would fall through. This was a broad daylight loot, but who do we complain to? I was forced to sell the black chickpeas at Rs.4,000 per quintal as against its MSP of Rs.5,500,” Rishiraj said over the phone. He said the new ordinances would spur fraudulent practices and encourage liaisons between corrupt government officials and private players. During the lockdown, most farmers in the State sold wheat at Rs.1,500-1,600 per quintal as against the MSP of Rs.1,925 per quintal.

Taking a potshot at Shivraj Singh Chouhan, who markets his agricultural background to shore up his support base, Rishiraj said the leader was nowhere to be seen while they struggled during the lockdown. “Wheat is harvested in March and sold in April. The unplanned lockdown meant that we could not harvest it in time. There was no diesel available in Narsinghpur. The labourers were stuck in their villages as there was strict prohibition of inter-village movement,” he recounted.

He said that the disruption of the wheat cultivation cycle was likely to land farmers in massive debt traps. “We buy seeds, manure and other essentials on debt. The delayed harvest meant that neither could we repay the debt nor did we have cash to prepare for the next crop.” Despite the MSP for mung bean being Rs.6,950 per quintal, Rishiraj and other farmers in the State were forced to sell it at Rs.5,000 per quintal.

End of APMC system

A conversation with farmers in different districts of Madhya Pradesh showed that they suspect that the government was under pressure from the World Trade Organisation (WTO) to stop procurement on MSP. Kohar pointed out that under the first ordinance, the Central government was planning to create a system of “one country, one agricultural market”. “The Central government has removed the condition that the first sale of agricultural goods has to be in the APMC yard. And purchase outside the APMC market will not attract any tax or duty. This means that the APMC market system will gradually end as taxes and other charges will continue to be levied in the APMC system,” Kohar said.

The Central government has not given any guarantee that the purchase of farm goods by an individual having a PAN card, or a by company or a supermarket will be at or above the MSP. Farmers fear that when the crops are ready, big companies will form cartels, deliberately bring down the prices of the produce, purchase it in large quantities and sell it at higher prices later.

Trilok Goti, a farmer in Dewas, strongly criticised Chief Minister Chouhan for failing to help farmers in any way, be it in harvesting crops or in selling the produce. “The lockdown has devastated vegetable growers. There was neither arrangement for transportation nor buyers. The government made no arrangement for storage, and the crops rot in the fields,” Goti said. He drew attention to the suicide of a vegetable grower, Narendra Singh Sendhav, in the nearby village of Abhaypur, as his onion crop was wasted and he had no money for the next crop.

Goti sold mung bean at Rs 3,500-4,000 per quintal, way below the MSP. “Shivraj Singh Chouhan says he is a farmer’s son. But all our pleas during the lockdown fell on deaf ears even as our crops were wasted or sold at low prices,” he rued.

Farmers point out that the second ordinance will encourage contract farming, leading to a situation wherein big companies will do farming and farmers will be relegated to the status of labourers in their own fields. Kohar explained: “Through this ordinance, the Central government wants to impose a Western model of agriculture on our farmers, but the government forgets that our farmers cannot be compared to Western farmers because the land-population ratio in our country is entirely different from that in Western countries.”

He added: “The government must remember that in our country, farming is a means of livelihood while it is business in Western countries. Experience shows that contract farming leads to the exploitation of farmers. Last year, the PepsiCo Company in Gujarat sued the farmers for several crores. The case was later withdrawn due to opposition from farmers’ organisations. Under contract farming, before sowing the crops, the companies promise to buy farmers’ goods at a fixed price, but when the crop is ready, the companies ask the farmers to wait for some time and later the produce is often rejected as being defective or rotten.”

However, with impending byelections in Madhya Pradesh (necessitated following the death of two sitting MLAs and resignations of 22 MLAs), Shivraj Singh Chouhan has been marketing what he calls his pro-poor and pro-farmer initiatives. “We have deposited Rs.40,000 crore into the accounts of the poor in Madhya Pradesh under different schemes. We made arrangements to buy farmers’ produce even in this crisis. [Former Chief Minister] Kamal Nath did not pay insurance premium. I paid the premium as soon as I formed the government and deposited Rs.2,990 crore of insurance into farmers’ accounts,” he recently said.

But for farmers like Rishiraj in central Madhya Pradesh, the government-sponsored crop insurance scheme known as the Pradhan Mantri Fasal Bima Yojana exists only on paper. “I haven’t heard of anyone who benefitted from the Prime Minister’s crop insurance scheme. What I do know, however, is that last year’s bonus on wheat and soybean are still due. The government is obliged to release a bonus of Rs.160 per quintal on wheat and Rs.500 per quintal on soybean over and above the MSP. But there’s no sign of it,” Rishiraj said.

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