In a step uncharacteristic of the Modi government, the three farm bills that were enacted almost a year ago have been taken back. On the auspicious occasion of Guru Parva, Prime Minister Modi announced that the three farm bills will be repealed in the upcoming session of the parliament and urged the protestors to go back to their lands.
However, repealing the farm bills is unlikely to end the protest that has held Delhi hostage for almost a year. Most of these farmers were in Delhi with political and religious motives, not economic. As far as the content of the bill is concerned, not a single decision was going to hurt the farmers and they have no idea of what the bills were all about.
They were protesting on the presumption that the Minimum Support Price (MSP), which benefitted the farmers of Punjab, Haryana, and Western Uttar Pradesh disproportionately, will be removed. And, with the corporate entry in the Agriculture sector, their role in production will be reduced. Moreover, they were worried about the fact that the government’s subsidies on input and output will be removed after the three farm bills.
But if one goes by the contents of the three farm bills, none of this presumption holds water.
- The first bill is about the freedom to sell the product.
- The second is about contract farming.
- The third is about removing much agricultural produce from Essential Commodities.
The first and third bills were set to give better price realization for agricultural production while the third would have enabled private investment in agricultural infrastructure.
None of the bills was going to impact the agricultural subsidies that the Modi government gives to the farmers. The Modi government has only increased the subsidies on fertilizer, seed (input) as well as the MSP (output) in the last seven years.
Moreover, the government has already removed the middlemen in the procurement of produce at MSP in all states with direct transfer of money to farmer’s accounts. In Punjab and Haryana, the farmers who have not integrated their land records with the central database are not getting MSP. Also, the third bill on Essential Commodities has more to do with execution rather than legislation and, the government is already cautious in imposing stock holding limits. So, the implementation of the first and third bills is already in place and the only decision that would suffer from the repeal of these laws is contract farming.
As far as politics is concerned, this is a big loss of face for the supporters of reforms, and also for the Modi government which is not known for giving up to pressure groups. The people across the country, who supported the farm laws and stood for their reformist nature will surely be disappointed. But this may help the Modi government politically in assembly elections.
Amarinder Singh, who recently broke away from the Congress party, has been eager to join BJP (although he made a new party). One of the conditions for joining BJP must be the repeal of the farm laws and with that achieved, he can join the saffron party in the coming weeks. The decision will also help the party in Western Uttar Pradesh in the coming assembly election.
So, although it is a loss of face for the supporters of the bill and the Modi government’s image of not going back on decisions, it is a politically shrewd step.