Promotion and Facilitation Act 2020 is the Second Law of Three Acts passed in the Indian parliament in Sept 2020 famously known as “The Three Farm Laws”. As the 5th round of talks with Central Government was inconclusive, the farm protests garnering the momentum from various employee unions across India. Various farm union across India are supporting the Punjab and Haryana Farmers while the India’s Progressive parties namely Congress Party, Communist Parties, other regional parties who have lost power since past 5 years in various state legislatures extended the support. The Farm unions have declared an India Shutdown call on Dec 8th. At this Juncture, Prime Minister Modi is exactly going through British PM Thacher’s moment. Although, Prime Minister Modi is ready to amend the objections raised by the farm unions and fill out every gap raised however, Punjab and Haryana State farmers want to repeal all “The Three Farm Laws”.  At this juncture, it is imperative to understand the details of “The Three Farm Laws” My earlier article discusses about the First Law :”. Here is the Second law “Promotion and Facilitation Act 2020”. 

What Promotion and Facilitation Act 2020 Says:

While Essential Commodities Act 2020 remove the essential commodities like Rice, Wheat, Edible Oil, Potatoes etc from the stockpile, except in real circumstances. This will curb the hoarding and Black market with illegal stockpile of essentials that often skyrocket the prices of food prices. This Second law, Promotion and Facilitation Act is intended to create an eco-system between the farmers and traders. So, the farmers have liberty to sell the farm produce of their choice at a competitive price through the viable trading channels. Since the partition of India in 1947, Farmers in India has only one way to sell the farm produce through Agriculture Produce Marketing Committee (APMC) Mandi. Since past 70 years, the farmers have the only choice to sell the produce at APMC Mandi with professional Middlemen negotiate the price for perishable and nonperishable produce while the State sets the Minimum support price for essential commodities but not for other produce like vegetables, Flowers, Fruits, Turmeric, spices, dairy, Silk etc. Thus, Farmers sell their produce at a price lower than anticipated plus farmers had to also spend for the labor, transport and other fee.  

Promotion & Facilitation Act 2020 allow the farmers across India to sell the farm produce to any business, or any trader of their choice.  Farmer has option to even reject to sell their produce if needed to the business as needed.  The Act allows the farmers to sell the produce anywhere in the country and eliminate the restrictions of selling at a specific location. The details of Inter and Intra State options are below: 

Inter State:

Interstate trade means the act of buying or selling of farmer’s produce, wherein a trader of one state buys the farmer’s produce from the farmer or trader of another state and such farmer’s producer is transported to a State other than the State in which the trader purchased such farmer’s produce and where such farmer’s produce originated. 

Intra State:

Intra –State trade means that the act of buying or selling of farmer’s produce wherein a trader of one state buys the farmer’s produce from the farmer or trader of the same state in which the trader purchased such farmer’s produce and where such farmer’s produce originated. 

Thus, the Farmers have higher advantage of selling the produce and specially the border districts of every state have greater advantage in selling the produce. Most of the time, Flower, Fruit, Silk, Turmeric Dairy farmers benefit with this facility. Earlier, these farmers have to sell in a specific location and this act eliminate the location criteria.  Every year, the farmers in Rayala Seema Districts in Andhra often challenged with drought and when everything aligned, then the minimum support price hinders them to get the investment back. Tomato Farmers in Anantapur Dist in Andhra every year had to go through a miserable plight when they had no choice but to sell their Tomato produce to as low as 1 Rupee per Kilo Gram. When the farmers do not get their investment back, they often commit suicides. This Act will eliminate the farmers miserable plight and Farmers can decide to whom to sell, where to sell and what price to sell. This will establish a specific relation between a trader and a farmer.  

Electronic Trading:

Like in most western developed countries like Unites States, United Kingdom and other European Union countries, where the farmers can sell their produce to any trader, person, entity through internet, the same facility has been accommodated in the Promotion & Facility Act 2020. Thus, Farmers across India will able to sell their produce to any retail trader, whole Sale, any person, partner company, any agricultural cooperative society or even sell their produce in Amazon or Reliance. Most of the time, the farmers can negotiate for transport and will eliminate middlemen fee, labor fee. The Farmer has the absolute freedom in negotiating the price at a competitive basis. The Farmer even can able to get into a contract ahead of the harvesting and sell the produce at a convenient time. The payment to farmer can be made on the same day or within 3 days on specific circumstances and with no fee levied by the states.

Opposition by Punjab and Haryana Farmers:

While, most of the Farmers in other States in India are much happier with the act, the farmers in Punjab and Haryana have raised some apprehensions due to the fact that this will eliminate the Minimum support price (MSP) as the years progress. Their other concern is that, the Mandi System will be slowly gets obsolete when the private Partnership grows in the future. They also raised that the Farmers has no choice of going to courts but have to settle the dispute with the local Sub Divisional Magistrate.  

Hypocrisy of Congress led UPA parties on Agriculture Reforms.

However, back in 2008, the then Agricultural Minister and the Chief of Nationalist Congress Party (NCP), Sharad Pawar in his capacity as a cabinet minister in United Progressive Alliance (UPA) Government in an official mail to the then Chief Minister of Delhi Sheila Dikshit categorically mentioned the need to amend the APMC act of 2003 to welcome the private investment and wanted to encourage an alternative mode in setting up competitive marketing channels which will benefit farmers. The letter was issued on June 12th 2007. Apparently, this progressive Agricultural reform by the current Modi Government is being opposed by the same Sharad Pawar is an irony.  

The Hypocrisy is not limited to Shard Pawar of NCP but as per the report published in Guardian, The congress led UPA has planned for agricultural reforms in APMC Act of 2003 as the committee found misusing the Mandi System as the Mandi’s not only charging high commissions but also impeding the reforms with private participation. Interestingly, Ministers from Various Congress States like Maharashtra, Haryana,Andhra Pradesh apart from Karnataka, Punjab, Odisha, Bihar were part of the committee and submitted the report after 9 meetings in a 2 years span. The report also have the stake holders including Farmers, industrialists, retailers and cold storage owners.

However, Modi Government have agreed to make every demand raised in “The Three Farm Bills” are being considered for an amendment and include the required in the act but the two state farmers are rejecting the proposal and wants a repeal.  

To be Continued..

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