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Reforms and direct payment will benefit farmers

If there were apprehensions about the smooth running of rabi grain marketing and procurement operations this year in view of the farmers’ agitation at Delhi borders, these have been quelled. In fact, the pace of wheat procurement at the minimum support price (MSP) has been exceptionally brisk this year, resulting in around 70 per cent higher purchases by the official procurement agencies than in the same period last year. Indications are that the government might have to pick up the highest-ever quantity of this staple cereal under its price support operations in the ongoing rabi marketing season. Evidently, the rigid and conflicting stands taken by the farm leaders and the government on the farm marketing reforms mooted through three new laws have not affected the disposal of the farm produce by the growers. It has, moreover, given the government a chance to test the waters by gauging the farmers’ reaction to the marketing reforms as distinct from that of the politically oriented farm unions.

An important takeaway from the current wheat procurement drive is that though the farmers of Punjab and Haryana supported the existence of arhtiyas, who served as their emergency moneylenders as well, they didn’t mind receiving the payments directly into their banks. Nor did they hesitate to sell their produce at the grain purchase centres set up outside the regular mandis if they got good prices there. Their unions are firmly opposing any out-of-mandi transactions of farm goods. The arhtiya system has already been abolished in most states, barring Punjab and Haryana. The Centre seems determined to do the same in these states. The direct payment to farmers is deemed the first step in this direction.

The Centre also seems to have used this year’s unusual circumstances as an opportunity to pave the way for initiating another long-pending farm sector reform — legalisation of land leasing. This has been done by making grain procurement conditional on furnishing proof that the producer has the authority to cultivate a piece of land as an owner or tenant. This move is aimed, ostensibly, at curbing the ongoing malpractice of sourcing grains cheaply from remote areas and selling them to procurement agencies at the MSPs. But since it would affect a sizable number of farmers who produce the grains on leased land, the state government would need to provide them legal protection by legalising land leasing. The Centre has circulated a model land leasing Bill, which safeguards the legitimate interests of both land owners and tenant-cultivators. The major advantage of this long-delayed reform would be to make tenant farmers eligible for drawing benefits from various farmers’ welfare programmes of the government, which are currently being unfairly denied to them.

This apart, the experience gathered from the series of talks with the agitating farm union leaders and the interaction with genuine farmers in the grain markets should help the government in strategising the culmination of the prolonged farm agitation. A possible way out could be to convince a large number of farmers that reforms are in their favour and will not affect their interests. While the government will continue its public procurement programme, opening up the sector will increase avenues for farmers with more organised buyers. The payment for crops will also be made directly and transparently.

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