Those of you who follow Indian politics will know that there are large scale farmers protests in Delhi, India. Thousands of farmers from Punjab, Haryana and Western UP have been blockading Delhi’s roads and camping out in the cold, protesting against three laws passed by the government of India in September. Some have died, but fortunately not due to any use of force by the state. These farmers, predominantly Sikhs have been winning hearts and minds by distributing free cooked food as Sikhs are wont to do. This winning of hearts and minds is bad for the farmers of the country at large because the farms laws will reform Indian agriculture.
India has the largest amount of arable land in the world. Within India, these three states are agricultural powerhouses ;84% of Punjab’s land is cultivable of which more than 95% is cultivated. It is no surprise then, that these states were handpicked for Jawaharlal Nehru’s green revolution in the 1960s. When India was short on grain and and Nehru was in love with the Soviet socialist system, these states were encouraged to grow wheat using modern imported seeds (in lieu of other crops) by the use of MSPs, minimum support prices at which the government was obliged to buy all that was grown from farmers. The MSPs were set in place ostensibly for a 10 year period but since, have been impossible to do away with because of political ramifications. Between then and now, MSPs have been extended to myriad crops including paddy and 20 others, most of which are possible to grow in these three states. The old farm law mandates that farmers sell only to the government and MSPs dictate the price at which the government will buy. However, cutting the market out of the equation has had predictably bad results over the years.
The grain coffers of FCI (Food Corporation India, the government buyer) are overflowing. Grain sits rotting in warehouses stocked at many times their capacity. Rodents routinely consume tons of the stored grain as the government watches on helplessly. Corrupt officials and politicians help the rodents in diminishing the stocks but have little effect as tidal waves of grain arrive each year, unchecked by the steadying hand of market forces. The water tables of all these states has fallen precariously in the last decade as some continue to plant rice in arid areas hurting subsistence farmers and allowing the already rich ones to consolidate their wealth by digging deeper borewells. Existing farm laws thus exacerbated inequalities in the agricultural economy.
The three farm bills which were recently passed bills seem innocuous at worst and progressive at best. One may be forgiven in finding it hard to understand why it is that the farmers are protesting. One bill relaxes restrictions governing purchase and sale of farm produce allowing individuals and corporations to buy grain, the second relaxes restrictions on stocking under the Essential Commodities Act (ECA), 1955, and the third introduces a dedicated legislation to enable contract farming based on written agreements. Essentially, the bills aim to reintroduce the private sector as a player in farming. The bills don’t mention or discuss MSPs as doing away with MSPs would be political suicide. The bills don’t abolish government buying, they just allow farmers more choice in selling their produce.
Even so, the protesting farmers from the three aforementioned states want none of it. They refuse to discuss the bills at all, in fact. They want a complete repeal of the bills. Although the bills don’t mention abolition of MSPs, the protesting farmers fear that it could a logical next step. These states together accounted for more than 70% of the money distributed under the MSP scheme. You see, unlike farmers in any other of India’s 29 states, these states have functioning government system with a guaranteed buyer ; The system works for them. All of the three states have, unlike any other state in India more than 75% of land under irrigation. Since the majority of voters in these states are farmers, their political clout guarantees good prices. Their soil permits them to grow MSP crops. Their participation in Nehru’s grand experiment gives them the moral high ground for demanding the continuance of his flawed policy.
This fear isn’t unfounded. Say private companies induce MSP reliant Punjabi farmers to grow another crop. As the percentage of farmers reliant on MSPs reduces, so will their clout. The absurdity of the absence of market forces will become more and more evident as the number of illogical MSP propped up farms decreases. Some change at least is bound to happen in the MSP domain as a result of these reforms in the medium term future regardless of the governments reassurances that they are not planning to change MSP rules.
Indian TV anchors in their characteristic fashion ask politicians from the BJP (the party in power), “The farmers don’t want it, why don’t you scrap it? Won’t the farmers know what is good for them?” to which politicians reply that the farmers are ‘misguided’. I can say here what the politicians can’t on TV, these are not ALL the farmers and they are not misguided farmers either. They have been getting the longer end of the stick for a long time and they are afraid of the future ramifications of tinkering with this sweet system which is unfair, but unfair in their favor.
So what is at stake here if the government relents and repeals the laws? it is the poorer farmers in other states, 10281 of whom committed suicide in 2019 who will be the victims. They don’t come from well irrigated agrarian states and are at the mercy of the rain. Their farm soils don’t permit them to grow MSP crops. And they can’t sell to anyone but the government at present. They don’t get a fair price for their crops and have to deal with petty corruption, simply because the crops they sell aren’t sexy enough to garner the political clout of paddy and wheat. These farmers need a helping hand. Private sector partners can bring in resources, modernization and help alleviate the risks. They may also bring in the clout necessary to influence change in policy and thus, irrigation etc. Private corporations armed with lawyers have a much better chance of fighting corruption than subsistence farmers.
The non farming population too has suffered because of this policy. Shekhar Gupta in his column “National Interest” mentions that the consumption of pulses has decreased at he expense of wheat and paddy. Multiple studies including one from IPSOS have highlight that more than 70% of Indians have a protein deficiency. Cheap MSP crops, politically impossible to change have crowded out more nutritious traditional foods leading to a peculiar situation where malnutrition coexists with excess food production. Moreover, government policy in a democracy is directed by interest groups who can deliver votes. Not all crops permit farmers to generate that clout. Neither can a government of a country so large and unwieldy such as India be able to micro-manage all of its citizens’ nutritional requirements by controlling prices of foods at a national scale.
In conclusion, I think that the government should stick to its guns. The farm bills constitute reform and it will never be popular because of the entrenched interests it upsets. Indians who feel inclined to side with the protesting farmers should take into account the millions of non protesting farmers who suffer silently, without the help of MSPs, yet tied to corrupt government buyers who have been given a sliver of hope with these new farm bills.
