OPINION | Improvement in Farmer’s Lives at Risk of Getting Lost in Politicisation

Soaring rhetoric rather than reality-driven dialogue has led to a deadlock between protesting farmers on Delhi’s borders and the central government. There is a growing worry that the static of political anti-Modi agenda is drowning even the protesting farmers’ demands.

Our agricultural markets ecosystem needs radical reform. Obsolete laws, vested interests and dishonesty have ensured that the farmer remained at the bottom of the value chain – working the most and getting the smallest share of the profits. Mandis are too often controlled by mafias, and corruption ensures that tax collected there rarely moves the needle in terms of rural development.

There has been broad consensus across political parties about the need for reform. Across NCP, Congress, AAP and even the Akali Dal, reform of the agricultural markets along the lines of the present three laws has been a part of announced agendas.

Multiple high-powered committees, including a 2013 one which had the CMs of Haryana and Punjab as members, have advocated similar transformation. The most telling proof though is factual – even as our agricultural output has increased, the lives and economic condition of most farmers have not improved at the same pace.

So, there was a need and a consensus about reforms. Narendra Modi provided the political will and decisiveness – to undertake the much-needed legislative action.

The reforms themselves have been covered in much detail but in essence they allow greater flexibility to farmers in terms of what they can grow, who they can sell to and where they can sell their produce. They seek to reduce distortions in cropping patterns caused by administrative measures, and attract more investment into the agricultural sector. While much has been discussed about MSP, the three laws have not sought to make any changes in the MSP process.

There is a second, worrying aspect to the agitation. This is the trend of using intransigent “blockade” type protests to oppose laws passed by Parliament. As the SC has opined, this has potential to cause duress and hardship to lakhs of citizens – who may have nothing to do with the issue at hand. More importantly, by extension of this logic, there is a risk that Parliamentary governance is made ineffective. Every group not in an agreement with a particular law can then seek to overturn the law using these tactics. It is a dangerous and slippery slope.

Governments may change but imagine such protests extending to states. We will have a logjam – legally and on the ground that will cause untold damage to the economy and hurt millions. The right to protest is absolute and inarguable – but as we mature as a democracy, we need to protect the interests, safety and convenience of the “aam aadmi”. A commuter should not need to travel an extra two hours a day just because of protests.

Some suggestions on resolving the present impasse.

– Dialogue – a zero-sum approach is neither constructive nor feasible. The concerns of the farmers from Punjab and Haryana need to be heard. The government has offered some suggestions for modifications. It is imperative that both sides find a way to mitigate valid concerns.

– Competitive federalism – In the BJP ruled states, the state governments can start to implement the farm laws. Successful execution with visible benefits to farmers will be the best way to build support for these much-needed reforms.

– Investment in Farmer Producer Organisations (FPO) and farmer empowerment – Help FPOs and similar organisations develop and grow so that they can help shift pricing power from middlemen to the actual farmers.

– Invest in the “backend” of agriculture marketing infrastructure – there remains a need for investing in digital information sharing to minimise arbitrages between markets, and in improving agricultural supply chains especially “cold chain” logistics. Governments at the centre and state levels must complement these farm bills with other administrative measures that attract private investment into this sector. Cutting-edge technology and scaling will only happen with private involvement.

– Ensure a level playing field – a key determinant for success of these farm bills will be if farmers gain more control over their produce, and not the replacement of present middlemen by other oligopolistic players. Competition rules specifically designed for the agricultural sector – to prevent market domination and encouraging innovation and entrepreneurship are needed.

– Continue the push to broaden the base of our rural economy – secondary sources of agricultural income, development of agri-tech industry etc.

The farm bills are a step in long overdue reforms of Indian agriculture. A constructive approach is needed – including complementary investment and administrative action to ensure that farmers reap benefits due to them.

The author is an international investment banker. Views expressed are personal.

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