Will farmers get a better deal after recent reforms? -Roshan Kishore
India has moved from a food-scarce economy to a net exporter of food. However, food production does not guarantee food security. Affordability is what matters.
New Delhi: The government has announced major agricultural policy changes as part of the economic package it has unveiled in the wake of the Covid-19 pandemic. These include deregulation of farm foods from the Essential Commodities Act (ECA). Farmers have also been allowed to sell their produce outside government-regulated markets, or Agricultural Produce Market Committees (APMCs).
The move has been celebrated by important voices. The crux of such arguments is twofold. One, laws such as ECA are irrelevant now because we are no longer a food-scarce economy. And two, it will allow farmers greater freedom in selling their produce. This is expected to guarantee better prices. Both these arguments have problems.
India has moved from a food-scarce economy to a net exporter of food. However, food production does not guarantee food security. Affordability is what matters. In the early years of economic reforms, India thought affordability will not be a problem. A universal Public Distribution System (PDS) was diluted into a targeted programme. This was reversed to enact the National Food Security Act (NFSA) in 2013. The NFSA covers two-thirds of the population as beneficiaries. It was passed by a Congress-led government and continues to be implemented by the Narendra Modi government. This bipartisanship is driven more by realpolitik than ideology. It is a recognition of the fact that a large part of our population still cannot afford food from the free market. In case of cereals such as rice and wheat, the government directly procures and then provides subsidised food. For other important crops, it uses a mix of policies including price and export controls and, sometimes, even usurping marketing activities when prices rise.
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Hindustan Times, 18 May, 2020, https://www.hindustantimes.com/india-news/will-farmers-get-a-better-deal-after-recent-reforms/story-8wrOzXKTL7J94cuInodOmK.html
Tagged with: APMCs APMC Act Agricultural Produce Marketing Committee National Food Security Act NFSA Essential Commodities Act 1955 Essential Commodities Act Agrarian Reforms Agricultural Reforms Inflation Food Prices Pandemic Covid-19