In an address today at 9 AM, the prime minister repealed the three farm laws that have long been a subject of political debate.
A thread explaining what were the three laws and what were the proposed changes and pros/ cons.
Note: Pls. avoid political comments here.
1/n
A thread explaining what were the three laws and what were the proposed changes and pros/ cons.
Note: Pls. avoid political comments here.
1/n
2/n
Agriculture is the backbone of rural economy - supports ~70% of rural households. However, far from efficient - crop yields lower by 30-40% vs global standards (lower output per acre), only 45% of sown area is irrigated & agri-capex has remained dismal at 2.2-2.3% of GDP.
Agriculture is the backbone of rural economy - supports ~70% of rural households. However, far from efficient - crop yields lower by 30-40% vs global standards (lower output per acre), only 45% of sown area is irrigated & agri-capex has remained dismal at 2.2-2.3% of GDP.
3/n
This limits production. Also, there are inefficiencies in the distribution process - too many layers between farmer and consumer, high pilferage and wastage due to poor warehousing and cold-storage infra, and non adherence to MSP, among others.
This limits production. Also, there are inefficiencies in the distribution process - too many layers between farmer and consumer, high pilferage and wastage due to poor warehousing and cold-storage infra, and non adherence to MSP, among others.
4/n
On September 27, 2020, The President gave his assent to three reforms - deemed a landmark moment for the Indian agriculture sector that can help remove supply-side bottlenecks
and improve productivity of the farm sector by attracting investments and boosting rural incomes.
On September 27, 2020, The President gave his assent to three reforms - deemed a landmark moment for the Indian agriculture sector that can help remove supply-side bottlenecks
and improve productivity of the farm sector by attracting investments and boosting rural incomes.
5/n
A. The Farmers’ Produce Trade and Commerce (Promotion & Facilitation) Act,2020
✅ Removed barriers to farmers to purchase and sell produce outside notified mandis
✅ Promoted interstate & intra-state trade, prevailing over APMC rules.
✅Allowed farmers to sell produce online
A. The Farmers’ Produce Trade and Commerce (Promotion & Facilitation) Act,2020
✅ Removed barriers to farmers to purchase and sell produce outside notified mandis
✅ Promoted interstate & intra-state trade, prevailing over APMC rules.
✅Allowed farmers to sell produce online
6/n
Small and marginal farmers (85% of total) are often subject to the regressive nature of the APMC policies. Under the Act, a trader transacting with a farmer had to pay on same or max 3 working days.
Small and marginal farmers (85% of total) are often subject to the regressive nature of the APMC policies. Under the Act, a trader transacting with a farmer had to pay on same or max 3 working days.
7/n
Expected benefits:
✅Increase availability of buyers for the produce
✅Increase better price discovery
Point of debate:
❌The Act prohibits state governments and APMCs from levying any market fee, cess, or any other charges on trade outside of the APMC-notified markets.
Expected benefits:
✅Increase availability of buyers for the produce
✅Increase better price discovery
Point of debate:
❌The Act prohibits state governments and APMCs from levying any market fee, cess, or any other charges on trade outside of the APMC-notified markets.
8/n
B. The Essential Commodities (Amendment) Act, 2020
Removed cereals, pulses, oilseeds, edible oils, onion & potatoes from the list of "essential commodities", thus no stockholding limits.
Aimed to attract private capital/ FDI by removing fears about regulatory interference.
B. The Essential Commodities (Amendment) Act, 2020
Removed cereals, pulses, oilseeds, edible oils, onion & potatoes from the list of "essential commodities", thus no stockholding limits.
Aimed to attract private capital/ FDI by removing fears about regulatory interference.
9/n
Expected benefits:
✅Drive up investment in cold-storage and modernization of food supply chain, and indirectly
support farmers to get better realizations. Adani invested 296 cr in Snowman.
Point of debate:
❌ Would facilitate crony capitalism towards large business groups.
Expected benefits:
✅Drive up investment in cold-storage and modernization of food supply chain, and indirectly
support farmers to get better realizations. Adani invested 296 cr in Snowman.
Point of debate:
❌ Would facilitate crony capitalism towards large business groups.
10/n
C. The Farmers (Empowerment and Protection) Agreement of Price Assurance and Farm Services Act, 2020
Proposed a national framework on contract farming - agreement b/w farmer & buyer prior to production.
A Conciliation board would resolve any disputes
C. The Farmers (Empowerment and Protection) Agreement of Price Assurance and Farm Services Act, 2020
Proposed a national framework on contract farming - agreement b/w farmer & buyer prior to production.
A Conciliation board would resolve any disputes
11/n
Expected benefits:
✅Level playing field to the farmers
✅Eliminates risk of market unpredictability, ✅Effective dispute resolution mechanism with better timelines.
Point of debate:
❌Private parties may have the upper hand in dispute resolutions.
Expected benefits:
✅Level playing field to the farmers
✅Eliminates risk of market unpredictability, ✅Effective dispute resolution mechanism with better timelines.
Point of debate:
❌Private parties may have the upper hand in dispute resolutions.
12/n
Here is the overall summary of proposed reforms that now stand repealed.
Here is the overall summary of proposed reforms that now stand repealed.
• • •
Missing some Tweet in this thread? You can try to
force a refresh
