PM hails Indian agriculture sector

Date:08-21-2020

On the occasion of the country’s 74th Independence Day on last Saturday, Prime Minister Narendra Modi said the country needed to replicate the “self-reliance” of the country in agriculture in other sectors of the economy, underscoring the “Atmanirbhar Bharat” campaign.

The prime minister said his government had freed the country’s agriculture sector by abolishing archaic regulations, which will help to increase famers’ income. “The last few years have seen pioneering changes and futuristic reforms in agriculture. Farmers now have access to more markets, better financial support,” the PM said.

Making the traditional address to the nation from the Red Fort, Modi said the country would adopt policies to reduce imports, just as it had done for food commodities. “There was a time when we used to import wheat from abroad; but our farmers have done a wonderful job. And now India is self-reliant in the agricultural sector.”

The prime minister referred to steps to unshackle the country’s farm sector. On June 4, the Cabinet had approved amendments to the six-decade-old Essential Commodities Act and cleared two other ordinances, one aimed at freeing up farm trade from all restrictions and the other guaranteeing a legal framework for pre-agreed prices to farmers.

“Some of you may not know this, but unlike any other business, where a businessman has the freedom to sell their product or service in any part of the country or the world and at a price they want, our farmers, till now did not have that freedom. They could only sell to who they were told to sell. Now, we have removed these restrictions, and given farmers the freedom to sell at the best price, and to whom they want,” Modi said.

Modi’s reference to the freeing up of the agriculture sector included reading down of provisions of The Essential Commodities Act 1955 to allow for freer trade in farm commodities. “I admit there are lakhs of challenges for India to become atmanirbhar (self-reliant), and yes, there is fierce competition from the rest of the world. But I always say that if India faces lakhs of challenges, it also has 130 crore solutions,” Modi said.

The agriculture sector, which supports half of all Indians, hasn’t been generating enough revenues to keep farmers profitable for nearly two decades due to trade restrictions and an obsession with keeping food prices low to avoid inflation, according to the OECD-ICRIER study mentioned above.

The NDA government also brought, on June 4, ‘The Farming Produce Trade and Commerce (Promotion and Facilitation) Ordinance, 2020’. The ordinance will effectively bring the curtains down on the decades-old agricultural produce market committees regulations (APMC) system that regulates buying and selling of farm produce.

These reforms in “agricultural marketing” have been a long time in the making and various government panels and economists have often argued for changing existing structures of agricultural trade.

The ordinance will pave the way for barrier-free inter-state and intra-state trade of farm goods outside the physical premises of markets notified under APMCs, the Cabinet note said.

The Modi government also approved ‘The Farmers (Empowerment and Protection) Agreement on Price Assurance and Farm Services Ordinance, 2020’, which effectively ushered new rules for contract farming and futures.