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While the Centre remains adamant on its plan to go forward with the anti-farmer Bills that have received widespread Opposition parties for the cause of farmers, state governments have decided to act in favour of marginalised farmers. Three days ago Kerala started contemplating a legal challenge in the Supreme Court, and yesterday, Rajasthan, Punjab and Maharashtra spoke out.
On the morning of protests on Friday, Punjab followed the footsteps of Rajasthan in taking immediate steps to secure the state government’s control on procurement and pricing.
Shortly after the nationwide farmers protest on September 25, Maharashtra government said that it would not allow the three agriculture Bills – the Farmer’s Produce Trade and Commerce (Promotion and Facilitation) Bill, the Farmers (Empowerment and Protection) Agreement of Price Assurance and Farm Services Bill and the Essential Commodities (Amendment) Bill – to be implemented, said a Rediff report. On the day of the protest, Deputy Chief Minister and NCP leader Ajit Pawar said in Pune that the NCP and other parties are opposed to the new bills. He added that a dharna agitation will be held on October 2 in the state.
Days after Parliament passed the three agriculture-related ordinances to regulate out-of-mandi transactions and provide a framework for contract farming, and the amended Essential Commodities Act, some states have started guarding their turf, to limit revenue loss on account of off-mandi transactions.
Kerala: Planning Board asked to study impact
Kerala reacted first, soon after the undemocratic manner in which the Bills were passed in Parliament last week-end followed by the arbitrary suspension of eight Members of Parliament. Calling for concerted efforts to oppose the controversial farm Bills, days before the nationwide protest, Kerala’s Agriculture Minister V.S. Sunil Kumar said that the Kerala government had sought advice from it’s legal department on the feasibility of challenging them in the Supreme Court. Kerala government decision was taken at the September 23 cabinet meeting.
The state government has asked the Planning Board to study their impact on various sectors, such as agriculture, fisheries, labour, animal husbandry and dairy development, Sunil Kumar told the media. The Planning Board has been directed to submit its report by September 30. He also suggested that the Kerala government would seek the cooperation of like-minded States, such as Punjab, in opposing the Centre’s “unilateral decision”. Kerala goes to the polls soon. Though ‘Agriculture, including agricultural education and research, protection against pests and prevention of plant diseases’ falls in the State List as per the Seventh Schedule, the Centre neither discussed the Bills with the States nor heeded their concerns, he said. The legislation serve only the interests of corporates, Mr. Sunil Kumar added.
Meanwhile, Kerala is moving to introduce an alternative mechanism to strengthen the agriculture sector using the primary agriculture co-operative societies and with the support of the Departments of Cooperation and Industries, he said.
Such support for the farmers from the south is particularly significant because Kerala does not have an APMC system. Thus, Kerala’s official support to the farmers counters the pro-Bill argument that the opposition is only limited in APMC-states such as Punjab and Haryana.
Rajasthan, Punjab take control of Mandis
Last month, Rajasthan had acted. The state had passed an order late in August 2020 designating all warehouses of Food Corporation of India (FCI) and state warehousing corporation as mandis, thereby retaining its powers to charge mandi fees. The order was seen by many as a move to neutralise the impact of the Centre’s ordinance designating all out-of-mandi areas, including warehouses and godowns, as trade zones where taxes could not be levied. According to the latest report of the Commission for Agricultural Costs and Prices (CACP), Rajasthan charged 3.6 per cent as mandi fees and other charges — the third-highest among major wheat procurement states of India.
The Rajasthan government has explored this loophole in the legislation, and declared all FCI and state warehouses mandis, so all transactions taking place in these would be eligible for state taxes.
The Rajasthan government had earlier expressed apprehensions about the impact of these new laws on state policies. On September 21, Revenue Minister Harish Chaudhary and Transport Minister Pratap Singh Khachariawas had told the media that the “anti-farmer Bills,” brought in a hurry, deprive farmers of the bonus on MSP. Last month, Rajasthan had declared all warehouses of the Food Corporation of India (FCI), the Central Warehousing Corporation (CWC) and the Rajasthan State Warehousing Corporation (RSWC) as procurement centres under the APMC Act.
Punjab
Further north, Punjab government said they were giving serious thought to amending the state’s APMC Act and declaring the whole of Punjab as a Principal Mandi Yard. According to reports, the government believes such an amendment will circumvent the changes in the Farmers Produce Trade and Commerce (Promotion and Facilitation) Bill. Declaring ‘mandi yards’ would mean that any procurement outside government ambit would become illegal thus ensuring MSO to farmers and Mandi fees to the state. On September 25 reports suggest that Punjab, the largest contributor of wheat and rice to India’s central pool, might also be looking at amending its Mandi Act to declare the entire state a Principal Market Yard. This would nullify the central law prohibiting imposition of any tax or cess on out-of-mandi transactions.
The central legislation defines a ‘trade area’ as any area outside of mandis notified under the state Agricultural Produce Market Committee (APMC) Act, including private market yards, private market sub-yards, direct marketing collection centres, private farmer-consumer market yards managed by persons holding any licence, as well as cold storage, silos and warehouses notified as marketplaces under the state APMC Acts. The central legislation clarifies that the definition of a ‘trade area’, where central provisions will apply, will be all areas other than the ones mentioned above. The Rajasthan government has explored this loophole in the legislation and declared all FCI and state warehouses mandis, so all transactions taking place in these would be eligible for state taxes.
Now, if the entire state is declared a Principal Market Yard, the central law would not apply anywhere in the state. And if FCI continues to procure from the state, it will continue to pay tax at a high 8.5 per cent rate on wheat and rice.
These taxes, according to some estimates, earn Punjab over Rs 5,000 crore annually, given the sheer amount of wheat and rice procured from the state every year.
Maharashtra
Pawar acknowledged farmers’ arguments that the laws were not beneficial to them and said that the state government will ensure that such laws are not implemented. He also said that his government had sought legal advice in case the matter went to the court.
Speaking about the Bills, the Deputy Chief Minister said that the new bills scrap the APMC system and hand over the marketing system to traders. He alleged that this would lead to scrapping of labour protection laws as farmers will not get the Minimum Support Price (MSP.)
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