FARM BILLS 2020

GROUP 5-B
PUBLIC POLICY DHRUMIL PANDYA C015
NILANKA GHOSH C018
AYUSHI JAIN C025
PRAJAKTA JOSHI C029
ANKIT MEHRA C037
ROHIT PATHAK C042

1
 Evolution of the Farm Bills
Features of agriculture in India Initiatives by government
 Contribution to national output: <17% (2019-20)  PM-Kisan Scheme
 Indian engaged 55%  E-NAM: National Agriculture Market
 86% of landholdings are small  National Mission For Sustainable Agriculture
 Terms of trade has worsened  Pradhan Mantri Kisan Maandhan yojana
 MSP for 23 crops, implementation poor  Pradhan Mantri Fasal Bima Yojana

The Passing of the Acts in 2020

Model Act, 2003  Farmers’ Produce Trade and Commerce (Promotion and
 Provided for development of efficient marketing Facilitation) Bill
system  Farmers (Empowerment and Protection) Agreement of
 Promotion of agri-processing and exports Price Assurance and Farm Services Bill
 Laid down procedures and systems for putting in  Essential Commodities (Amendment) Bill
place an effective infrastructure Objectives
 Make it easier for farmers to sell & produce for the
How do APMCs work private sector
 Do away with government interference in agricultural
Produce
Farmers APMC Auction Arthiyas
sold trade 
 Remove restrictions of private stockholding of
Sources:
https://www.civilsdaily.com/private-and-co-operative-sector-in- agricultural produce
marketing-of-agriculture-produce-in-india/
http://www.msruas.ac.in/pdf_files/Publications/MCJournals/Ma  The bills deal with the regulation of contract farming 2
rch2015/2_V.Nagendra.pdf
 Private Sector Entry In Agri Marketing
Private players in agricultural sector have adopted a new models of marketing and distribution enhancing the efficiency

The private sector participants E- Choupal by ITC

 Provide modern infrastructure, technologies & distribution
• Agri business houses practices to cater to the agriculture
• Agri processing firms involved in contract farming  6,500 E-choupals in operation in 40,000 villages
• Farm produce organization and Co-operatives
• Non government agencies, financial agencies Hariyali Kisaan Baazaar(HKB) by DCM Shriram
 Chain of Agri-input retail store providing last-mile
Contract Farming by PepsiCo delivery of relevant agri-technology
 Farmer is contracted to plant contractor’s crop on  Access to new markets/ buyers for farmers produce
his land at a predetermined price  Providing farmers with quality warehousing facilities &
 Provides assured buy back mechanism insulating access to commodity exchanges
farmers from market price fluctuations
 PepsiCo India’s potato farming programme Safal by NDDB
connects with more than 12,000 farmer families  Fruits and vegetable auction market for directly procuring
 Helps farmers get credit at a lower interest rate by and selling horticulture produce by technology backing
tying up with SBI eliminating middlemen
 Weather insurance through tie-up with ICICI  Mother dairy also procures and sells veg, fruits and dairy
Sources: https://www.civilsdaily.com/private-and-co-operative-sector-in-marketing-of-agriculture-produce-in-india/ products directly from farmers to consumers
http://www.ecoti.in/1FYSqb 3
http://www.msruas.ac.in/pdf_files/Publications/MCJournals/March2015/2_V.Nagendra.pdf
 The Flip Side

Bihar govt abolished APMC act in 2006. However, it retained MSP for crops that are procured for PDS

Objectives of abolition of APMC Act MSP Conundrum

 To boost investments from private sector Retention of MSP system failed due to poor implementation
 Improve investments in cold storage & warehouses of Primary Agriculture Cooperative Societies (PACS), a
 Free up markets for farmers to trade their produce body set for procurement of food grains from farmers.
 Procurement timing and the quantity is inappropriate
Key Facts which led to oversupply
Farmer income rose between 2007-10, there has been a  PACS did not ensure fair price, thus produce being sold
decline since 2010 due to: at a price lower than MSP in other markets
 Farmers switched to cash crops
 High Storage costs at private warehouses
 Both traders and farmers made to pay ‘market charges’
at unregulated markets
 High fluctuation in prices, specially grain prices
 Agricultural land used for non-agricultural purposes
 Lack of investment from the private sector
 Bribery to pay agents to sell in different areas
Sources: https://www.civilsdaily.com/story/agricultural-marketing-reforms/
https://www.thelede.in/governance/2020/09/26/the-bihar-model-of-agriculture-why-it-failed
https://www.livemint.com/opinion/columns/lessons-from-bihar-s-abolition-of-its-apmc-system-for-farmers-11600962615201.html 4
 Key Opportunities and Challenges

OPPORTUNITIES
• Boost to Contract Farming
• Several Agri-tech start ups who provide
Farming as a Service (FaaS) are set to
gain
• Low-interest financing by financial
CHALLENGES
institutions for private sector to help them
• Openness of various state governments to
build the required infrastructure
implement this act in its entirety
• Interacting directly with individual farmers
with small land holdings could be
challenging for private sector without a
Sources:
https://timesofindia.indiatimes.com/blogs/toi-edit-page/agricultures-watershed-moment-new-farm-bills-will-unshackle-43-of-indias-w
orkforce-that-is-engaged-in-the-sector/
platform or middlemen
https://inc42.com/features/agritech-startups-on-the-new-models-in-the-wake-of-the-farm-reform-bills/ 5