Competing visions for Indian Farmers: Three new laws for farmers are being vehemently opposed for good reason

Description of image: If we keep farmers happy, we keep the nation happy as they represent 58 percent of all Indians.Photo by Jose Aragones from Pexels

Updated December 21, 2020

Agriculture is the primary source of livelihood for about 58% of India’s population (according to the India Brand Equity Foundation*). This, despite a disproportionately low contribution of 18 percent to India's GDP.

Hence the Indian government's keenness to open up the farming market to corporate marketing and distribution. This interest in agriculture was reinforced when planners saw a growth rate of 3.4 percent (in agriculture, April to June 2020), even as the Indian economy as a whole contracted by almost 24 percent.

This is how the Modi government (in the monsoon session) of the Indian Parliament hurriedly (some would say ill-advisedly) passed three laws in an effort to boost agriculture. 

In the process the government was seen to be moving away from institutions and programs that farmers had come to rely upon such as the Agricultural Product Marketing Committee Markets that help farmers sell their produce in many regions and  also provide a reliable framework for dispute resolution should payments be delayed or a transaction go awry. According to veteran journalist P. Sainath, the new anti-farmer legislation disallows legal redress should the farmers have a dispute with the government or even one of the corporations that the farmers are dealing with.

Further, minimum support prices for a variety of crops declared by the government before each growing season are seen as a vital support to farmers.

1. Farmers Produce Trade and Commerce (Promotion and Facilitation) Bill, 2020; 

When it comes to “marketing” or the first sale of their produce— and the dismantling of the monopoly of APMCs (Agricultural Product Marketing Committees)— farmers, especially those in Punjab and Haryana, aren’t very convinced about the benefits of “freedom of choice, to sell to anyone and anywhere.”

The reason for this skepticism is simple: Much of government procurement at minimum support prices (MSP) — of paddy, wheat and increasingly pulses, cotton, groundnut and mustard — happens in APMC mandis or markets. In a scenario where more and more trading moves out of the APMCs, these regulated market yards will lose revenues. If the government stops buying, only the big corporates (who will want to dictate prices) will be left to sell to.”

The recently enacted law that did away with the monopoly of APMC (agricultural produce market committee) mandis (markets) has been fiercely fought by farmers. These markets offered farmers an albeit imperfect yet more protected arena to operate in especially when minimum support prices were declared by the government and payments (at minimum support levels) assured or made by agents at APMC Mandis. 

The Minimum Support Price (MSP) is declared by the government before the sowing season and is supposed to help farmers decide which crops they would sow. The Minimum Support Price regime is not available everywhere. It covers around 23 crops spread across several Indian states. 

Other states announce minimum support prices outside the APMC system where processors are required to pay the minimum support price. In this situation payments tend to be delayed more than the APMC system offers.

The new laws do not guarantee the continuation of the APMC safety net even as they permit the sale and purchase of crops outside regions where state government-regulated market yards were in operation. Farmers may be open to expanding their market potential but do not want to lose their government safety net in the process.

2. Farmers (Empowerment and Protection) Agreement on Price Assurance and Farm Services Act will enlarge the role of contract farming and is therefore considered suspect by farmers. 

The Act  may also help farmers as it provides a regulatory framework for contract cultivation which over time is likely to grow given the growth of the food processing industry. The law relates to streamlining agreements between farmers and agri-business firms (processors, large retailers or exporters) ahead of planting for the supply of produce at guaranteed prices.

3. The Essential Commodities (Amendment) Act does away with the Centre’s powers to impose stockholding limits on foodstuffs stockpiled by corporations, except under “extraordinary conditions” (such as a 50 to 100 percent rise in prices). Given the amendment, corporations will be able to more easily stockpile agri-commodities and thus possibly manipulate prices (by flooding the market to lower prices) or purchase and hold produce to raise prices.

All three of these laws have resulted in an outpouring of ire by farmers and their allies all over India (especially farmers in Punjab, Haryana and Andhra Pradesh), despite the government's claims that these laws will make the agricultural sector freer than before.

While it is true that the Indian food industry is poised for huge growth, the manner in which this is done is vital to the lives of our farmers. Yes there are prosperous farmers in Haryana and Punjab but this prosperity has yet to reach the majority. In 2016 (the latest year for which data acknowledged by the government is available), an average of 33 farmers a day committed suicide. Many whose crops failed or those who owned huge sums to money lenders.

Also India should be learning from the mistakes of the West without following headlong in replicating their errors. Today in the USA, the larger family farms have mostly been taken over by corporate farms except for a few exceptions in the warmer regions of California, Florida etc. There is a growing movement that supports small organic farms all over the world. Many of these operate on leased land but are profitable on account of higher prices and market demand.

India is increasing its contribution to world food trade every year due to its immense potential for value addition, particularly within the food processing industry. The Indian food and grocery market is the world’s sixth largest, with retail contributing 70% of the sales. Hence the high level of interest from Industrial houses that are allied to the BJP government like Adani and Reliance. The Indian food processing industry accounts for 32% of the country’s total food market, one of the largest industries in India and is ranked fifth in terms of production, consumption, export and expected growth. 

Essential agricultural commodities export for the April-September period of 2020 increased by 43% to Rs. 53,626 crore (US$ 7.3 billion) over Rs. 37,397 crore (US$ 5.1 billion) in the same period last year.

Agriculture is more than just the largest employer in the Indian economy. It feeds the Indian people. The increased role of corporations in farming has done little to reduce the consumption of pesticides and chemical fertilisers despite the availability of pesticide free technologies. The result is the continued growth of cancer clusters. Companies like Monsanto are already selling genetically modified cotton. Other agri-producers are looking to introduce genetically modified products into the food supply (without caring about the health implications) by catering more to the needs of corporate buyers.

Overall, not everything in these three new farming laws is bad but farmers and the general public should (in this writers view) fight for an expansion of safety nets for farmers and provide incentives to farmers to consider new business practices.

The writer, Pravin JP Arapurakal is a member of the Aam Aadmi Party and currently serves as a National Executive Member of AAP's Labour Wing,  the Shramik Vikas Sangathan (SVS). SVS was founded by Shri Gopal Rai who currently serves as Environment Minister for Delhi State. The opinions in this article are the personal opinions of the writer. Comments or suggestions if any may be sent to

*India Brand Equity Foundation (IBEF) is a trust established by the Department of Commerce, Ministry of Commerce and Industry, Government of India. IBEF's primary objective is to promote and create international awareness of the Make In India label in markets overseas and to facilitate dissemination of knowledge of Indian products and services. 


  1. The first sentence of this article is the real problem the farmers are facing! 58% ,that's more than 1 farmers for every 2 people in India! Supply is high and demand is lesser which means farmers can be squeezed to sell their produce! This is happening because of the trap laid by the govt. The trap is classifying farmers property as agricultural property and by giving poor education which forces them to remain farmers!the classification of their property as agricultural, keeps their land prices low as nothing but farming can be done on it.if it was not classified as agricultural property, It gets the farmers the opportunity to make other forms of income by unlocking the potential of their land. This will reduce the farmer count and thereby balance the living standards of the farmers.currently they are forcefully kept in an unfair economic position.

  2. These days there are many (educated) people making huge amounts on very little agricultural land. Horticulture is one answer and these farmers also need training in new methods like aquaponics. SVS amd our NGO partner "Healthy Neighborhood" has started pilot programs in horticulture and is looking at land leasing programs for landless laborers. Stay tuned. We must all do what what we can to help.

  3. Government stands for the Corporate sector and fooling the farmers and the public. Their stand is utterly sceptical and misleading.

    1. The government can only involve the corporate sector with proper protections for farmers so that they cannot be exploited or cheated. If and when these protections are in place, then farmers too may benefit from the value addition process, otherwise the corporate sector will benefit at the expense of the farmers.

  4. If we take an example of the rice quality in indian market it is not nutritious as other countries, most of the western countries import rice from thailand.
    This is happening because in one way we indian people forgot our culture and they dont provide a radiance towards quality, rather they focus only on the profit in business . Fertility of the soil is an utmost important .
    The mediator between customers and farmers has to be completely removed . the farmer who gives us food is barely nourished and he is starved out who gives us food . If we continue this same practices going on we will definetly end up in crises. Has our green overtaken us in such a way that our hearts are turned into stone.
    Its a shame.


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