While bringing transparency in agri commodity trade, new farm laws will force APMC Mandis to be competitive: Dr Shivendra Bajaj, FSII

While bringing transparency in agri commodity trade, new farm laws will force APMC Mandis to be competitive: Dr Shivendra Bajaj, FSII


There has been a big controversy over the new farm laws. Will they be beneficial for the farmers in the long term?
We believe that the new farm laws will give farmers the freedom to sell their produce and further help them to discover better prices from all the markets. The government now need to make a robust implementation of the new rules and encourage the Mandi system to upgrade their infrastructure, use modern technology and help farmers with know-how and training to enter into and execute contracts, access agricultural commodity markets, and utilise price forecasts for their produce. There is also a need for a major effort to build capacity among farmer producer organisations (FPOs) to conduct their commercial deals profitably. Digital proficiency is to be built among FPOs and farmers so that they can use the digital platforms effectively to buy inputs and to sell their output. This is the start of a new era for the Indian farmers. These reforms have been delayed by over 20 years. Transformational changes can happen for the farmers’ profitability and the face of agriculture can change for the better. There might be initial issues to adoption and infrastructure but in the long run the farmer will be the beneficiary.

How farmers were subjected to exploitation from the middlemen in the APMC markets? What was the intensity of losses to farmers?
Lack of infrastructure and proper training and skills to understand and negotiate commodity prices made the farmers vulnerable to middlemen. The old system gave farmers no choice and they had to go through middlemen to sell their produce. With the new reforms, farmers are definitely going to benefit by choosing their own markets and customer base without going through any middlemen. Digitisation will also make the entire process transparent.

How private players, corporates would help farmers get fair remuneration?
Private players and corporates have been investing in building infrastructure. Skill building, knowledge sharing and bringing quality products to the farmers have always been the agenda of the players. With the new law, The Farmers (Empowerment and Protection) Agreement on Price Assurance and Farm Services Act, 2020, it will allow farmers to now tie-up with private players, choose what they want to grow and seek better prices. This step has definitely given farmers the independence to grow crops that is in demand and find right consumers to buy their produce.

Corporates would need crop produce of good quality? How can farmers ensure this?
Corporates have been working with farmers for seed production. With the new laws, this will be encouraged and many more farmers would enter into contracts with corporates. Such a system of collaboration would lead to input and knowledge support for the farmers, that will benefit the farmers in the long run due to increased awareness and soil and water management. Long term collaborations between corporations and farmers would be mutually beneficial.

What happens to the existing APMC markets? Would they be able to compete with corporates?
APMC markets will function in the same way as in the past. Farmers still have the option to trade in these markets. With the new laws, the farmers have been given freedom to choose various other marketplaces to trade their produce. The current APMC can improve infrastructure and make their operations efficient to compete with the new and upcoming markets. Eventually all these parallel market systems will find their own equilibrium of co-existence.

What efforts farmers must take to get maximum benefits under the new system these farm laws have created?Since the competitiveness will increase, farmers will now have to ensure that they sell quality produce which means that they will have to buy quality seeds, inputs and follow best agronomic practices. They need to diversify their crop, fruits and vegetables to tap varied consumers. Nutrition and quality produce will be the top priority for consumers in the post COVID world.

Can’t farmers be exploited by corporates? What measures the government must take to protect farmers in such case?
Corporates can survive as long as farmers benefit from their products and services. Not just corporates, many e-commerce platforms and start-ups too work with farmers to connect them to a larger consumer base. Farmers can decide for themselves with whom they want to engage with. The laws are very new, and I believe with Government making more robust tweaks in days to come, it will create avenue for farmers to test different markets.

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