Did the BJP consult farmers about the bills?

Directly? No. But the bills didn’t pop out of the blue either. Nearly 2 decades worth of committees had made recommendations very similar to what was passed, and all of them had consulted with agricultural organisations. Here are some of the excerpts from the reports by various organisations, including the UN:

2001: Inter-Ministerial Task Force:

“Essential to delink minimum support price (MSP) from procurement, particularly if the private sector is to be restored its rightful role in marketing agricultural produce. The alternative policy should allow market forces to determine the price and provide financial support through an insurance programme to farmers for protection of their incomes in falling markets.”
The same task force also commented that “(i)ncidence of taxes by way of market fee, cess, duties, taxes etc. on procurement of agricultural or horticultural produce under the ‘Contract farming’ program should be waived or minimised”. This piece of advice was heeded in the 2003 APMC Act.

2001: The Report of the Task Force on Employment Opportunities:

“The marketing of agricultural produce, especially fruits and vegetables is governed by laws that stifle the development of agriculture. The existing laws require that wholesalers must purchase agricultural produce only in regulated mandis controlled by the Agricultural Produce Marketing Committee (APMC). Since most farmers are small farmers, they cannot directly bring vegetables and fruits to the mandis. They typically sell their produce to village commission agents who collect produce on behalf of the market commission agent who sells to wholesalers in the mandi. Although sale in the mandi is supposed to be by open auction to ensure fair pricing, in practice the price is determined in a highly non-transparent manner by negotiations between market commission agents and wholesalers. Lack of transparency is perpetuated by the fact that produce is not graded before it is sold. The prices arrived at in this fashion are declared as the mandi price and the farmer receives the residual price after the commission of the village commission agent and the market commission agent is deducted from the declared market price. Not only is the price determination nontransparent, the large number of middlemen, each of whom charges a commission, squeezes the realization of the farmer so that the gap between the farm-gate price and the retail price paid by the consumer is very large. Although originally designed to protect farmers’ interests by creating regulated markets, the system has actually created a monopoly situation in which a small group of traders and agents are able to extract huge benefits. It is absolutely essential to liberalise the existing laws and allow competing markets to be set up. The Government of Karnataka has amended the Agricultural Produce Marketing Act by ordinance to allow (the) National Dairy Development Board (NDDB) to set up a modern fruits and vegetable market in Bangalore. This is a welcome development. We would recommend full decontrol so that any group of persons should be allowed to set up modern marketing infrastructure to facilitate marketing of agricultural produce subject to paying the normal mandi tax. The establishment of a competing market will help farmers.”

2005: The Second Report by the National Commission on Farmers:

“The major constraint of the regulatory framework of the agricultural produce marketing system is that it discouraged investments by the private sector, allowed certain monopolistic practices to develop and generally discouraged free trade and competition. It is surprising to note that a processor has to pay a fee on commodities brought into the notified area for processing without any service/value addition by the regulatory authority. In the present arrangement the farmers have no choice. In case they want to sell their produce in the wholesale market, they have to come to the regulated markets. Absence of choice and competition has adversely affected the development of markets and interest of the farmers and consumers in the changed circumstances.”
The commission also made this suggestion: “Enabling private and cooperative sectors to establish and operate (including levy of service charge) agriculture marketing infrastructure and supporting services.”

2005: The Food and Agricultural Organisation of the United Nations:

“As regards the collection of market fees through the APMC Act, it still continues to be a major hurdle on the free movement of primary agriculture products from not only between States but also even within the States from one market area to another. As already stated, it sometimes results in double taxation of the same products. Moreover, its operation creates monopolies of the State Marketing Board/Market Committees in regulating the wholesale market by not allowing direct marketing, often leading to cartelization of a few brokers or arthiyas and non-transparency in price setting to the disadvantage of the farmers. The monopolistic operation of the market committee also acts as a disincentive to the private sector in setting up processing units for value addition, as they do not have direct linkage with the farmers, which would otherwise help them in getting raw materials of assured quality and quantity. The policy framework should give farmers the liberty to freely market their produce anywhere including direct marketing to processors or other buyers without paying any market fees. However, in case they want the facilities of the market yard, they have to pay a service charge, which should be sufficient to cover the operation costs of the market committee. It is therefore recommended that farmers, processor companies or other private operators may be allowed to operate their own wholesale market and charge a suitable fee for the service. This would encourage more investment in setting up infrastructures and create opportunities for providing better and more cost-effective services.”

2006: The Fourth Report by the National Commission on Farmers:

The farmer wants different options for marketing his produce. The State APMC Acts need to be amended to provide for among others, encouraging the private sector or cooperatives to establish markets, develop marketing infrastructure and supporting services, collect charges, allowing marketing without the necessity of going through APMC/ licensed traders etc.
Apart from repeating the above message, Ms Swaminathan’s Commission’s second fifth report then highlights that the benefits of APMCs have not reached small, marginal and medium farmers.

2012: The Economic Survey of 2011-2012:

“Some state governments have granted licences to the private sector for setting up of markets and direct purchase from the farmers in order to provide alternative marketing channels. There is considerable potential for agricultural markets to be competitive. As the APMC was created to protect the interests of farmers it will be in the fitness of things to give farmers the choice of going to the APMC or not. In the light of this, the need is to pursue further reforms in the state APMC Acts.”

2013: Final Report of Committee of State Ministers:

“Due to the restrictive provisions of the Essential Commodities Act and various Control Orders issued thereunder, private investment in large scale storage and marketing infrastructure including in the areas of contract farming, direct marketing have not been very encouraging. Under the present system, the marketable surplus of one area moves out to consumption centers through a network of middlemen and traders and institutional agencies. Thus, there exists national level physical, though, there is no national level regulation for the same and the existing regulation does not provide for a barrier free market in the country. There are many significant Inter-State barriers to trade, viz. (a) Taxation Related Barriers (variation in rates, applicability of VAT, levy of market fee at multiple point, etc.); (b) Physical Barriers (Essential Commodities Act, Check Posts, APMC Regulations, etc.); and (c) Statutory Barriers relating to licensing and registration of traders, commission agents. Therefore, there is a need to develop a national level single market for agricultural commodities by removing all the existing barriers of licensing, movement and storage. Facilitating free trade and movement of agricultural commodities would enable farmers to get best prices for their produce, achieve price stability and ensure their availability at reasonable prices in deficit areas.”
“The present Act restricts the farmers from selling their produce to processor/manufacturer/bulk processor outside the market yard as the produce will have to be channeled through regulated market according to provisions of the APMC Act. In the changed scenario, the producer should be free to enter into direct sale without the involvement of other middlemen outside the market yard in the market area under the relevant provision of the concerned Act. This will facilitate direct marketing between the producers and processing factories with monetary gains to the producer-seller through improving competitiveness and to the consumers by way of reasonable prices.”
“The regulatory framework needs to undergo a change by providing a free hand to the private sector to own, operate and manage markets/alternate marketing systems with backward and forward linkages. The Government may at best formulate rules of the game for the market players rather than controlling the system. The role of the Government should be that of facilitator only.”

2014: Economic Survey 2013-2014:

“Various committees and task forces of the government recommended that control over agricultural markets by the state be eased to facilitate greater participation of the private sector, particularly to stimulate massive investments required for the development of agricultural marketing.”

2015: Economic Survey 2014-2015:

“The 2014 budget recognizes the need for setting up a national market and stated that the central government will work closely with the state governments to reorient their respective APMC Acts to provide for the establishment of private market yards/private markets. The budget also announced that the state governments will also be encouraged to develop farmers’ markets in towns to enable farmers to sell their produce directly.”

2017: Economic Survey 2016-2017:

“There is (a) need to remove all restrictions on internal trade on agricultural commodities and dismantle fragmented legislation that governs agriculture. At present, there are four legislations in existence/formulation to regulate agriculture markets, i. Model APMC Act, 2016 to replace the present state legislations on markets, ii. Agricultural Produce Trading (Development and Regulation) Act, 2017, iii. A law that would regulate contract farming and iv. A law/regulation that would regulate e-NAM. Several legislations of the State and Centre ensure that the agricultural markets are fragmented and the benefits to the farmers remain low. The above legislations need to be dismantled and moved towards a Common National Agriculture Market as envisaged in the e-NAM initiative.”

2019: Standing Committee on Agriculture (2018-2019)

“Creation of a conducive environment for setting up and operating private wholesale market yards and farmer consumer market yards, so as to enhance competition among different markets and market players for the farmers produce, to the advantage of the latter.”

Three Acts:

http://egazette.nic.in/WriteReadData/2020/222039.pdf

http://egazette.nic.in/WriteReadData/2020/222040.pdf

Bibliography:

https://ruralindiaonline.org/library/resource/serving-farmers-and-saving-farming-from-crisis-to-confidence—second-report/

https://niti.gov.in/planningcommission.gov.in/docs/aboutus/taskforce/tk_empopp.pdf

https://ruralindiaonline.org/library/resource/serving-farmers-and-saving-farming-towards-faster-and-more-inclusive-growth-of-farmers-welfare—fifth-report-volume-ii/

https://www.indiabudget.gov.in/budget2012-2013/es2011-12/echap-08.pdf

https://ruralindiaonline.org/library/resource/serving-farmers-and-saving-farming-jai-kisan-a-draft-national-policy-for-farmers—fourth-report/

https://dmi.gov.in/Documents/stminprreform.pdf

https://www.indiabudget.gov.in/budget2014-2015/es2013-14/echap-08.pdf

https://www.indiabudget.gov.in/budget2015-2016/es2014-15/echapter-vol1.pdf