India’s countless farmers have rallied together en masse over the past few months to protest farm ordinances imposed by the Indian government. These ordinances may have severe implications for agriculture in India, including reduced state support for agriculture, the increased domination of corporate interests, and a threat to food security, land rights, and livelihoods of the farmers. The intersection of this development with already tenuous conditions may fuel a famine and further increase vulnerability of the agrarian classes, writes Karishma Shelar.
Starting late November 2020, millions of farmers have marched to and gathered on the outskirts of New Delhi, India’s capital, where they have been met with water cannons of the riot police, barricades, tear gas and lathi charges (the police-led beating of protesters with clubs). Defying COVID-19 restrictions and the bitter cold, the farmers are protesting newly passed national government farm ordinances that seek to dismantle former regulations and legislations protecting the farmers from laissez-faire price and purchase mechanisms. This blog attempts to break down why the ordinances will escalate in a famine-like disaster while discussing the debt-cum-groundwater crisis in the state of Punjab which lies at the heart of the ongoing protests.
Paving the way for corporate farming
Simply put, the farm ordinances, if passed, pave the way for full-fledged corporatisation of India’s agricultural sector through free market price mechanisms and the eventual withdrawal of all forms of state support for agriculture. This spells disaster for nearly 60% of India’s households directly or indirectly relying on the agricultural sector for jobs or survival, of whom 86% are small and marginal landholders (holding plots of land of less than two hectares).
The farm ordinances can have three devastating impacts:
- It is a step towards disassembling mandis (state-regulated marketplaces where agricultural produce is traded) to make room for agro-business-driven open market trading.
The mandis are not flawless systems of trade. They are limited in number and geographically favourable to certain regions and class groups. Nevertheless, these are important systems of price discovery and signalling. The mandis are supposed to assure farmers a minimum support price (MSP) declared by the state for their produce. What is required of the government, then, is to strengthen and expand procurement through the mandis and to legalise MSP than abolish the system and shrug off its responsibilities.
- No legal assurance of the MSP in the ordinances leaves the farmers vulnerable to the whims and fancies of agro-businesses and other private players.
Such firms are more concerned about making profit than ensuring accessible and affordable food to the public. While the ordinances allow for farmers to enter pre-determined contract farming arrangements with private entities, the former’s financial precarity and no protection against potential discrepancies on part of the latter compromises the farmers’ bargaining power.
In addition, over the past three decades, the increased privatisation of agricultural inputs has resulted in a rise in input costs that has now spiralled into a debt crisis for agrarian households. Private entities with their enormous financial capacity will have free reign to dictate the terms of exchange, pricing, type of produce and inputs, enslaving the farmers to market dictates and furthering the debt crisis in the country. A recent report also suggests that 45–60% of India’s rural households are unable to meet their daily nutritional requirements. Securing the interests of private players in agriculture will only escalate a famine-like crisis in the country.
- The ordinances allow for the unregulated storage of harvests, with limited regulation thereof by the state except in the case of extraordinary circumstances such as war, famine, or excessive price increases (exceeding 100%).
This move is aimed at providing private entities freedom to stockpile and control the storage and distribution of harvests. It threatens food and nutrition security to millions of people and particularly those dependent on one of the largest state-run public distribution systems (PDS) in the world. Under the National Food Security Act of India (GoI, 2013), 65% of the households (or around 800 million people in India) are legally assured a right to food at subsidised rates from the PDS and through welfare programmes such as the Integrated Child Development Services and the Mid-Day Meal Scheme.
Additionally, the Food Corporation of India (FCI) is legally mandated to maintain a central pool for procuring, storage, transportation and maintenance of food stocks in the country to which the mandi system and the PDS are closely linked. Besides, as per the Government of India’s estimates, the PDS supported food security for 750 million people during the COVID-19 lockdown (PIB, 2020). The ordinances indicate the intent of the government to downscale the role of the FCI and the PDS by promoting open-market food procurement, thereby dismantling the existing state structures that ensure nutrition security.
Punjab: a case in point
The state of Punjab is one of the major benefactors of the state-based system of procurement through the MSP. In the 2019-20 agricultural year, it contributed 28% and 21.5% of the total wheat and rice produced in the country to the central pool of procurement (FCI, 2020b, 2020a). Therefore, while the farm ordinances are being opposed by farmer unions across the country, the Punjab farmers have become the face of the protests around New Delhi.
It must be noted that Punjab was one of the leading states to adopt the assemblages of Green Revolution in the 1960s and 1970s, which brought about prosperity to farm households in Punjab and self-sufficiency from food imports to India. However, this dramatically shifted the traditional cropping patterns of the state. In 1966, rice occupied around 5.2 million hectares (MHa) of land in Punjab (Mann, 2017), spiking to 23.39 MHa by 2012 and displacing other food crops that occupied over 50% of Punjab’s area under cultivation in the pre-Green Revolution period to around just 10% in 2012. Over time, the ecological impact of the Green Revolution has become visible in the form of deteriorating groundwater tables and soil quality that have led to stagnating production levels (Sarkar and Das, 2014).
The period also witnessed the average debt per cultivator household in Punjab increase to INR 216,524 in 2014–15 from INR 7,125 (USD 97.21) in 1991–92 (NSSO, 1998; GoI, 2014). Literature on the agrarian crisis in Punjab also acknowledges an increase in landlessness, with small and marginal farmers resorting to wage labour and forced to sell their land and other assets to pay off. Often, the income earned from wage labour is so meagre that it becomes impossible to pay off incurred debts. The unremunerative nature of agriculture further impoverishes households when they are forced to take on a debt to meet social obligations and cover health-related expenses(Padhi, 2009; Singh and Bhogal, 2020).
While it must be acknowledged that the agrarian dynamics of caste, class and gender differ greatly across geographies in India and also in Punjab, the current farmer protests mirror the larger agro-ecological crisis that has penetrated the country. The farm ordinances will only aggravate indebtedness, escalate land degradation, open the floodgates for corporate landgrabbing, and further deteriorate the socio-economic situation of the landless.
FCI (2020a) ‘Statewise Procurement of Rice for RMS 2019-20’. Food Corporation of India. Available at: https://fci.gov.in/app/webroot/upload/Procurement/Statewise%20Procurement%20of%20Rice(KMS%202019-20)_56.pdf (Accessed: 10 October 2020).
FCI (2020b) ‘Statewise Procurement of Wheat for RMS 2019-20’. Food Corporation of India. Available at: https://fci.gov.in/app/webroot/upload/Procurement/Statewise%20Procurement%20of%20wheat_57.pdf (Accessed: 10 October 2020).
GoI (2013) The National Food Security Act, 2013. Available at: http://www.egazette.nic.in/WriteReadData/2013/E_29_2013_429.pdf (Accessed: 12 October 2020).
GoI (2014) Key Indicators of Debt and Investment in India – NSS 70th Round 2013. New Delhi, India: Ministry of Statistics and Programme Implementation – National Sample Survey Office, Government of India. Available at: http://www.mospi.gov.in/sites/default/files/publication_reports/KI_70_18.2_19dec14.pdf (Accessed: 10 May 2020).
Mann, R. S. (2017) ‘Cropping Pattern in Punjab (1966–67 to 2014–15)’, Economic and Political Weekly. Economic and Political Weekly.
NSSO (1998) ‘Debt and Investment Survey: NSS Forty Eight Round (January – December 1992)’. National Sample Survey Organisation, Department of Statistics, Government of India. Available at: http://mospi.nic.in/sites/default/files/publication_reports/419_final.pdf (Accessed: 12 July 2020).
Padhi, R. (2009) ‘On Women Surviving Farmer Suicides in Punjab’, Economic & Political Weekly, 44(19), pp. 53–59.
PIB (2020) ‘Pradhan Mantri Garib Kalyan Anna Yojana Phase-I: April 2020 to June 2020’. Ministry of Consumer Affairs, Food & Public Distribution, Government of India. Available at: https://pib.gov.in/PressReleasePage.aspx?PRID=1643542 (Accessed: 5 December 2020).
Sarkar, A. and Das, A. (2014) ‘Groundwater Irrigation-Electricity-Crop Diversification Nexus in Punjab: Trends, Turning Points, and Policy Initiatives’, Economic and Political Weekly, 49(52), pp. 64–73. Available at: http://www.jstor.org/stable/24481208 (Accessed: 10 October 2020).
Singh, S. and Bhogal, S. (2020) ‘Punjab’s Agricultural Labourers in Transition’, Economic and Political Weekly. Economic and Political Weekly.
 These are the Farmers’ Produce Trade and Commerce (Promotion and Facilitation) Ordinance of 2020, the Farmers’ (Empowerment and Protection) Agreement on Price Assurance and Farm Services Ordinance of 2020, and the Essential Commodities (Amendment) Ordinance, 2020.
Opinions do not necessarily reflect the views of the ISS or members of the Bliss team.
About the authors:
Karishma Shelar has recently graduated with a MA in Development Studies from the ISS, part of Erasmus University. Her dissertation focused on the agro-ecological crisis in rural India and investigated the interlinkages between agro-ecology and indebtedness at the level of the state, agro-businesses, and households.
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