Indian farmers, mainly from northern Punjab and Haryana states, have been protesting recently implemented agricultural bills since November of last year and have gained massive international attention. Although the three bills were intended to modernize India’s farming sector, farmers worry that it will disempower them and possibly decrease their quality of life. Protestors have been camping outside of New Delhi for six months. They are stocked up with supplies that can last them up to half a year, planning on remaining until the laws are repealed.
What are the three agricultural acts that farmers are protesting?
The first act, passed last year, is The Farmers’ Produce Trade and Commerce Act. Prior to this act, farmers in India would sell their produce in mandis – government-controlled markets where only licensed traders could buy produce, and the government would commit to purchasing stocks of essentials at a fixed Minimum Support Price (MSP). This system was introduced in the 1960s to combat a nationwide food shortage. Since then, farmers could only legally sell their produce in mandis. However, the Farmer’s Produce Act allows for trading on unregulated markets outside the traditional mandis, creating a dual market structure. Although this act was passed to increase trading opportunities for farmers and buyers, critics believe that consumers will move from regulated markets (the mandis) to the deregulated ones, which eventually can result in the collapse of the traditional market system. This will leave farmers with no choice but to trade on unregulated markets where large corporations can form cartels and drive down the prices of produce, endangering farmers’ income.
The second act is The Farmers Agreement on Price Assurance and Farm Services Act. The act creates a new framework for farming contracts, now strictly between farmers and traders with little government oversight. It also limits farmers’ ability to take disputes to court, inevitably allowing large corporations to force farmers into unfair and one-sided contracts. This risk is especially heightened by the fact that most Indian farmers are smallholders – 68% of them own less than 1 hectare of land. Therefore, most farmers have insufficient finances and power to stand up to large corporations and cartels in case of disputes.
The third act is The Essential Commodities Act. This act eliminates storage limits for produce that the government previously set to control prices. The estimated consequence is that large organizations with sufficient finance can stock up on produce and then use their supply to control the market prices.
Farmers believe that by limiting the government’s protection, these three acts will leave farmers at the mercy of large companies that will use their now unregulated power to drive down prices and significantly endanger the livelihood of farmers. These effects can be seen in the state of Bihar in India, which pursued a similar deregulation strategy. Bihar’s Agricultural Produce Market Committee was deregulated in 2006, removing licensing barriers to the agricultural market. While this did not trigger significant private investment, the regulated mandis deteriorated, leaving farmers exploited by private traders who fixed low prices.
Despite their large numbers (nearly 60% of India’s population is employed in the agricultural sector) and romanticization, where they are often held up as the soul of the nation, India’s farming community is economically vulnerable. More than half of the farmers in India are in debt, which in part contributes to the fact that at least two dozen farmers commit suicide daily, and a fifth of farmers live below the poverty line. These statistics are only worsening with covid-19’s impact on the farming industry and the economy. All of this should be a cause for increased economic protection of farmers by the government, not less.
What has the government’s response been?
The government has defended its position on the three bills by arguing that it expands the range of potential consumers for farmers and that the deregulation of the market will attract more investment, which will financially benefit farmers. They also promised that they will uphold the minimum price (MSP). However, farmers remain unconvinced on these counts. They insist that they will be exploited and disempowered if the MSP isn’t upheld in the unregulated parallel market.
The government initially tried to dismiss the protestors by employing racist rhetoric. They argued that Sikh farmers, who represent the majority of protesters, are motivated by religious nationalism rather than genuine economic concerns. However, this strategy backfired and only served to further provoke the protestors and caused more of the public to join their cause. The government has also violently responded to mostly peaceful protests: protestors marching towards New Delhi faced the police in riot gear, equipped with tear gas, water cannons, and batons, and one protestor has allegedly died at the hands of the officers. Moreover, the government temporarily suspended internet services across the areas of protest outbreaks, blocked Twitter accounts that were advocating for the farmers, and detained journalists reporting on the protests.
Recently, however, the government has been under increasing pressure to negotiate with the protesting farmers. For one, in a very rare move, the Supreme Court in India stayed the implementation of the three bills passed by the Parliament. Additionally, the upcoming budget session may allow parties that support the farmers to oppose the government in the Parliament. Farmers also form a significant part of the government’s voter base. As a result, the government held discussions with the farmers, offering to amend the laws and suspend implementation for 18 months if the farmers end their demonstrations. However, the farmers refused this offer and are currently planning to continue their protests until the government repeals the bills and legally sets the minimum support price (MSP) on paper.
While these bills might help expand the Indian agricultural industry through private investment, it does so at the expense of the livelihood and agency of millions of farmers and their families. Often, economic policies leave behind vulnerable communities in favor of macroeconomic growth. As the world continues to change and developing countries become desperate to catch up with others, it is essential not to leave behind the communities that need the government’s support the most. It is also important for the public to stand with the communities that protest for their economic protection.