Reform mandis, don’t close them down: Noted agricultural scientist Devinder Sharma

Noted agricultural scientist Devinder Sharma spoke to TOI on the implications of the new farm laws for the agricultural sector — on why MSP is a basic right of farmers, how 'rich' farmers in the Indian context is a dangerous misnomer, what one can learn from Kerala in such matters etc. Excerpts from an exclusive interview:The government claims that the new laws are beneficial for farmers and hence, it will not repeal them. But it said it is willing to keep the laws in abeyance till amendments are made after more discussions. Your thoughts on it?Whatever the government might claim, the farmers have a different viewpoint. They want these laws to be repealed. Their argument is that at no stage did the farmers ask for these laws to be brought in nor were they ever consulted before they were quickly passed in Parliament. Keeping them in abeyance is an allurement to make the farmers return home, and further, it is likely that given the composition of the committee that has been set up, the same kinds of laws, with a little bit of tinkering here and there, would be reintroduced.The farmers feel enough is enough. That is why they are remaining adamant and seeking the withdrawal of the laws. For decades, they have been denied their rightful income. A study by Organization for Economic Cooperation and Development in 2018 had shown that Indian farmers had suffered a cumulative loss of Rs 45 lakh crore in 16 years, between 2002 and 2016-17. This was because the farmers were earning 15% less for their crops compared to international prices. According to Economic Survey for 2016, the average income of farmers in 17 states in India, which means roughly half the country, was just about Rs 1,700 a month.The government’s claim is that the new laws will help increase farmers’ income. Why shouldn’t the farmers welcome it?If the same open markets have failed to prop up farm incomes in rich countries, how can they help enhance incomes for small farmers in a country like India?Some economists say the new laws will provide much-needed freedom for the farmers and they would be free to sell their produce in any state...They become really free when they know where and to whom they must sell so that they will at least get the minimum support price (MSP). Considering that 86% of Indian farmers have landholdings less than 5 acres, the challenge should be to bring the markets closer to the small farms. The closer the “mandis” (government-regulated wholesale markets), the less is the possibility of them selling at a distress price.We have roughly 7,000 “mandis” set up under the Agricultural Produce Market Committee (APMC) in India. We need a network of 42,000 “mandis” if we have to provide a “mandi” in a radius of 5km. That’s the kind of marketing infrastructure we need to create.Well, there are problems with “mandis”. Do you think APMC needs reforms?Yes, over the period there has been lot of deterioration in the way APMC “mandis” work. But this is true for other institutions as well. The solution is not to close down these institutions but to suitably reform them. I have always supported reforming the APMC system by making it transparent, bringing in professionalism and delinking it from political control. Take the case of Bihar. It revoked the APMC Act in 2006. It was argued that private investments will come in, private “mandis” will be set up to enable price discovery for farmers. Nothing like that happened. Farmers are being ruthlessly exploited.Some people say the protests are largely led by rich farmers from Punjab and Haryana...It cannot be denied that the movement began in Punjab (and later in Haryana) where farmers felt that the new laws will lead to further exploitation at the hands of the corporate sector. It has now expanded to Uttar Pradesh, Rajasthan and the ripples are now being felt across the country. But to call Punjab farmers rich is simply an effort to give a wrong impression about a hardworking farming population.We need to know that every third farmer in Punjab is below the poverty line. Farm households in Punjab carry a cumulative debt of Rs 1-lakh crore. A house-to-house survey conducted between 2000 and 2015 showed that more than 16,600 farmers and farm workers had committed suicide. Is that a reflection of rich farming? Punjab farmers spearheaded the protests due to the fear that the new laws would gradually make APMC “mandis” redundant leading to discontinuation of MSP. The average farm income in Punjab is the highest in the country because government procures 98% of paddy and about 80% of wheat at MSP.Farmers in southern states like Kerala seem to be largely disinterested in the farm laws, maybe because they have diversified their farming practices to cash crops. Do you think Punjab and Haryana farmers should also diversify?Yes, Kerala farmers have diversified, mainly to plantation crops that fit the agroecological conditions. Punjab farmers too want to diversify to less waterguzzling crops. But the government has failed to provide a robust marketing system with price assurance for alternative crops. As a result, farmers are reluctant. Last year, they cultivated maize in large areas as an alternative to paddy. But against an MSP of Rs 1,850 per quintal, the farmers received Rs 600-1,200 per quintal. Why would they undertake losses in the name of crop diversification? Why can’t the government provide a better guaranteed price for the alternative crops?Do you think providing direct income support to farmers would be a better option?In my understanding, what the protesting farmers are demanding is an assured income by way of an assured price. They want MSP to be made their legal right, meaning no trading takes place below the MSP.Considering that farmers not just in India but across the world suffer the brutality of markets, time has come to provide an assured price to them for all the 23 crops for which MSP is announced every year. We cannot allow farmers to single-handedly bear the burden of subsidy. Keeping the farm prices low helps to keep food prices low. The entire cost of keeping food prices low therefore is borne by the farmers alone. This has to change. Making MSP a legal right does not mean that the government will have to buy the entire produce. It only means raising the benchmark. For instance, Kerala has initiated a floor price for 16 vegetables, ensuring cost of production plus 20%. It has made a budgetary provision of Rs 35 crore but hasn’t still made any purchases because the market prices are ruling higher than the floor price. There are lessons here that need to be replicated for other crops.