Farm Bill 2020 passed in September 2020 permitted setting up of new markets while allowing the existing APMC Mandi’s to function. It merely increased the farmer’s buying options that set the cat amongst the pigeons in the APMC Mandi’s of Punjab that had been a monopoly market for FCI ( Govt buying) for the past few decades. The Union Government during the year had also increased procurement under MSP in the financial year 2019-20 by 15% benefiting Punjab and Haryana the most. The FCI procured rice and wheat of Rs 56,000 crores from Punjab alone which was a third of its total procurement. If we look at the statistics we find Punjab accounted for 21% of the FCI procurement for rice which is way above what it procures from other rice growing states like UP 7%, Tamilnadu 4.2%, Bengal 3.5% and Bihar 2.5%. Similarly in wheat procurement Punjab accounted for 37.8% and Haryana 27.3% of FCI’s procurement though a dozen Indian states produce wheat.
“ In 2019-20 alone, government agencies procured 201.14 lakh tonnes of wheat and 226.56 lakh tonnes of paddy from Punjab and Haryana. That, at their respective MSPs of Rs 1,925 and Rs 1,835 per quintal, would have been worth Rs 80,293.21 crore. And all these purchases were done in the mandis” wrote the Indian Express in an insightful article titled ‘Farm Bills 2020: Actual text vs perception’. Yet a month later Punjab CM Capt Amarinder Singh bypassed the Central laws 3 bills to bypass the farm bill 2020 . and warned of unrest if the farm bills were not revoked. Why ?
This was because his plan to waive the farm loans of Arthiya’s was reportedly not accepted by the Centre. So both farmer unions and the Arthiyas were asked to gherao Delhi which they have done so effectively forcing the Government on the backfoot. This is why the Arthiya association is behind the protest by the farmer unions against Farm Bill 2020 and BKU and other farm unions are being financed to stay put if necessary for months. After all it is a case of retaining status quo which gave Punjab and Haryana the unfair advantage of Rs 80,000 crores of centres FCI purchases at MSP for the last few decades. The state earned taxes of Rs 6500 crores and Rs 2000 crores commission was earned by the Mandi Dalal annually.
For further details please read the three back issues of the blog
Punjab Chief Minister Capt, Amrinder Singh will arrive and have a round of talks with the home minister Mr. Amit Shah on the 3rd of December. It will possibly lead to discussions on the loan waiver after which the siege of Delhi by Punjab farmers could be lifted. So like it or not the taxpayer has to foot the Bill for a crisis in which he has been held at ransom and made to pay.
For knowing about the structural deficiencies in farming that led to Farm Bill 2020
You can read my book
Chapter 11 Volatility in Food Prices : Can it Be Controlled
Chapter 12 Indian Agriculture at Crossroads : New Direction Needed
which discusses the 3 myths of Indian farming and wether MSP help reduce farm distress?