Farmers across several districts in Punjab like Jalandhar, Khanna, Faridkot, Sangrur and Mansa are complaining about the extortionist demand by Arhtiyas or commission agents to hand over signed blank cheques as a condition for procurement of wheat crop as reported by the Indian Express.

Nihal Singh, a farmer from Bhatinda’a Baulana village was startled by the demand of his Arhtiya to give him a signed blank cheque just as he was getting ready to cut his standing wheat crop and send it to mandi. Nihal’s Arhtiya demanded the blank cheque for repayment of Rs. 2 lakh loan taken by him two years back. Although he has already repaid the principal amount, his Arhtiya demanded Rs.1 lakh as interest dues. For this payment of usury interest rates, the Arhtiya now wanted blank signed cheques from Nihal.

A worried Nihal said, “I assured him that I will pay the entire amount due, but he is not ready to take my word and asked me to give a blank cheque signed by me or my crop will not be auctioned by him in the mandi. But I have not yet to decide on it.”

Nihal said he owns five acres of land and he is unlikely to give a blank cheque as he fears that the Arhtiya will encash the whole amount in a lumpsum, while he had planned to pay it in two instalments as he has to meet other expenses too.

Nihal’s case also brings to fore the hardships faced by small farmers being outside the sector banking sector for procuring loans from these middlemen money lenders at exorbitant interest rates.

Farmer Jagtar Singh of Ganga Nathana village also complained of the same extortionist demand from his Arhtiya. He said despite harvesting crops of 7 acres, his Arhtiya has demanded a signed blank cheque as a condition for auction of his crops. Jagtar had taken Rs 3 lakh loan four years back for his daughter’s marriage, which he has been repaying the Arhtiya in instalments during procurement.

Farmer Joga Singh of Sangrur had a similar complaint. He said that his Arhtiya has demanded from him a signed blank cheque as a pre-condition for shipping his crops to the mandi for auction.

The story is the same across several districts of Punjab like Jalandhar, Khanna, Faridkot, Sangrur and Mansa where farmers have complained about similar extortionist demands by their arhtiyas.

Jagsir Singh, farmer leader of BKU (Ugrahan) from Bathinda, said that he was approached by several farmers with complaint about the demand of signed blank cheques and even Aadhaar cards by the Arhtiyas.

Jagsir Sigh said that the BKU has asked the Arhtiyas to stop making the demands till alternative arrangements can be made for their payments. He claimed the Arhtiya’s are worried that the farmers will not pay them their dues after getting paid directly from the government.

The Arhtiyas used to earlier auction their crops in the APMC mandi and pay the farmers after deducting their high commission rates amounting to 40% of the total income.

The small farmers of Punjab take high interest usury loans from the Arhtiyas, as we saw in the earlier examples, nearly 50% interest rates who auction their crops. These Arhtiyas paid only a fraction of the money earned from auction of crops to the farmers after deducting the money due to them as commission and payment towards the loan owed to them during the procurement seasons.

Non-Implementation Of New Farm Laws Leaves Farmers At The Mercy Of Arhtiyas

Farmers kept out of reach of the banking sector for loans are forced to take loans from these middlemen who therefore make huge profits out of very high interest loans given to the farmers and high commission rates for selling their crops at mandi.

With PM Modi starting special drive to include the farmers in formal banking services by various schemes of very low interest loans offered to them the situation is gradually improving.

But the non-implementation of the new farm laws by the Punjab government has piqued the situation for farmers in Punjab. The Farming Produce Trade and Commerce (Promotion and Facilitation) Act, 2020 aimed at freeing the farmers from the clutches of the APMC mandis and their middlemen, by providing them additional options of selling their crops at any mandi of their choice other than APMC markets.

This would have helped the farmers to get better prices for their produce and also helped them do away with APMC registered middlemen, through whom the farmers were forced to sell their produce.

Even if any farmer chose to ship his produce directly, the APMC regime did not allow him to sell his produce without registered middlemen. The middlemen thus, in several cases made huge amount of money without doing anything, i.e. without even moving the crops!

The Farmers (Empowerment and Protection) Agreement on Price Assurance and Farm Services Act, 2020 provides a legal framework to facilitate contract farming by a prior agreement between the farmer and the buyer before the production or even sowing of the crops. The farmers’ bargaining and negotiation capacities would have enhanced to get them highest value for their crops by implementation of these laws.

The implementation of these laws would ameliorate the financial condition of the small and marginal farmers by giving them unhindered access to all markets or best contract deals enabling them to get highest price for their produce. Thus, the farmers of Punjab would have been saved from the present crisis and freed from the extortionist clutches of Arhtiyas had the new farm laws been implemented in Punjab.

News input and Image Source: Indian Express

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