Historic Reforms in Agriculture Marketing in September 2020, three Bills were passed by Parliament of India (Lower and Upper Houses):
Farmers’ Produce Trade and Commerce (Promotion and Facilitation) Bill, 2020:
- Intra and Inter State Trade of farmer’s produce was now allowed beyond the physical premises of existing markets: Trade in/at:
- Farm gate,
- Factory premises,
- Silos and
- Cold storages.
- Online trading of farmer’s produce was allowed and farmer organizations and private sector were enabled to set up their electronic trading platforms.
- State Governments would not levy market fees, cess or levies outside the physical market area.
Farmers (Empowerment and Protection) Agreement of Price Assurance and Farm Services Bill, 2020:
- Farming agreements between farmers and buyers have been made possible, for production or rearing any farm produce.
- The price of the produce will be clearly mentioned in the contract.
- A clearly specified dispute resolution protecting the rights of both farmers and buyers.
The Essential Commodities (Amendment) Bill, 2020
- The Central Government may only invoke the provisions of the Essential Commodities Act, 1955 in an extraordinary situation (war, famine, extraordinary price rises and natural calamities)
- Imposition of stock limits must only be based on price rises -if there is a 100% increase in retail price of horticultural produce and a 50% increase in the retail price of non-perishable produce.
Importantly, these bills do not dismantle the existing structure of State APMCs; rather, they provide competition to this system by opening up alternative marketing structures, direct buying, and contract farming. These bills do not replace the prevailing system of public procurement at MSP.