Articles by ecothrust at Technorati Headline Animator

Thursday, December 3, 2020


For over a week tens of thousands of farmers  from Punjab have stormed the national capital demanding the roll back of farm reforms - specifically  the 3 Farm Bills 2020. Prominent among those leading the protest was Naresh Tikait President of the Bharatiya Kissan Union BKU a leading farmer activist  and Ravinder Singh Cheema President of the Punjab Arthiya Association who are usually at loggerheads with one another. Strange bedfellows? Why? 

The presence of Cheema and the Arthiya Association funding the protest was pointed out by me at the CNN News 18 TV Show The Right Stand on November 28th
The reason why Tikait shared the platform has been elaborated in the LSTV 6.00 PM show Public Forum on 2nd Dec repeat telecast at 10.00 PM and at 12.30 PM of 3rd December.
It is a very interesting story that reads like a potboiler.:

Farmer Unions like BKU and Arthiyas ( Mandi Dalal’s)  are usually at war in Punjab’s farmlands. 
In April 2016 in the Barnala District double suicide case when mother Balbir Kaur and son Baljit Singh committed suicide, the BKU ( Dhakonda ) activists fought pitched battle with the Arthiyas and their gun totting security who had come to take possession of the land of Baljit Singh in village Jodhpur of Barnala District. As a matter of fact a third of the farmer suicides in Punjab ( 8294 between 2000 to 2015 as per Punjab Vidhan Sabha statistics ) happens when the Mandi Dalal who is also the financer  and  money lender to the small farmer attains a judicial order for  Kukri of the small farmer’s land. 


At that time of the Jodhpur village twin suicide, Darshan Singh Sanghera who was the Vice President of Punjab’s powerful Arthiya association was quoted in the Chandigarh Tribune “There is no such thing as a crisis in Agriculture. The villains are the unions that defend farmers rights” In its detailed report  The sins of commission   it outlined the friction between the Kissan Unions that fight for the small farmer  and the money lender Arathiyas who are the very rich  farmers who control and deal with the FCI purchases. The small farmer usually sells his crop to the Mandi Dalal at a discount of 15% to  20% who in turn sells to the FCI, bribes them and the bankers who remit the money to the accounts and supplies to the mills. (No Govt purchase can take place without bribing and FCI is no exception ) The small farmer also borrows from the Mandi Dalal when in dire need and he has exhausted his limits to borrow from the local co-operative bank or his CIBIL score is below par. Needless to say that the interest of the Mandi Dalal is 15% to 20% which is 3 to 4 times that of the co-operative bank. 

Fakhre e Quam for Captain Amarinder 
In December 2016 Captain Amarinder Singh promised to waive farmers debt of Rs 10,000 crores if elected . But only Rs 1700 crores of  loans taken by marginal farmers with 2 acre landholding that was outstanding to cooperative banks were waived. Later that year The Indian Express published a report that gave addresses and names  of 21 farmers committed suicide in 45 days . So Captain Amarinder Singh declared that he would also get the loans taken by the farmers from the Arthiyas waived. Following that announcement the Arthiya Association facilitated CM Capt Amarinder Singh as Fakhr e Quam  as per the Indian Express.

Protecting the monopoly of Punjab Farmers 

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

India Emerging : From Policy Paralysis To Hyper Economics 

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? 







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