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Agricultural sector reacts positively to PM Modi’s agri reforms as record number of Agro companies register

TFI Desk by TFI Desk
21 December 2020
in Trending
Modi,
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Amid the protest from elite farmers on Delhi-Haryana borders, substantial evidences have started coming out that the farm bills are set to reform Indian agriculture and make it more productive. As per data from the Ministry of Corporate Affairs, the number of new companies registered in Agriculture and allied sectors grew by 35 per cent in the first eleven months of the ongoing calendar year, when compared to the same period with the last year. Moreover, most of these companies were registered between June and November.

The Modi government promulgated three farm ordinances on 5th June which were later presented and passed in the Monsoon session of the parliament. The number of companies registered in Agriculture and allied sectors increased exponentially after the Modi government promulgated farm ordinances because these made the entry of corporates in Agriculture easy.

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The entry of corporates and corporatisation of the existing players will increase the amount of capital in the farming sector as well as increase the access of capital to the farmers. So far, the credit to the agriculture sector was one of the lowest in India despite several government diktats, because, the no financial institutions would not be willing to give loans to an entity whose principal aim is to not work for profit. Also, the farmer suicide rate on farmers was among the lowest in this year given two years of successive good monsoons which led to a record production and record procurement by the Modi government.

The pandemic increased the demand for essential agricultural commodities exponentially and the income of farmers grew manifolds in the last few months.

The better than expected response from the entrepreneurs to the government’s farm laws shows that the agriculture sector was waiting for these laws for long, but no government was brave enough to bring the reforms due to the over-politicization of the agriculture sector in India.

So far, the purchase of farmer’s produce directly by corporates was illegal, and therefore, corporates used to shy away from direct involvement with the farmers. However, with the new bills in place, the corporates will make value addition in the farm products and push for exports, which will end up benefiting the farmers.

The entry of corporates in the farm sector is essential because the farmers do not have skills to negotiate in the international markets which are heavily protected by Western governments and corporates. The entry of Indian corporates in the farm sector will not only directly link the farmers with the Indian market, but with the international markets too. And, this will help the Indian farmers to become rich, just like the farmers of Western countries.

In countries like Southeast Asia, the farmers gained enormously with the use of technology like niche Whatsapp groups and apps. The experience of Southeast Asian farmers could be replicated in India, and the middlemen could be removed altogether with the entry of corporates which have innovative solutions to traditional agricultural problems. The emergence of Agritech- apps like JioKrishi- will end the reliance of farmers on the state, and the role of middlemen will also end. The Indian agricultural sector is set for golden days ahead, thanks to Modi government’s courageous step to implement reforms which were waiting for the last two decades.

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