Why are India's farmers protesting, and will Modi reap what he sows?
Millions of farmers from over 450 unions and organisations in India took to the streets this week to protest against laws deregulating the sale of crops.
The new laws allow private buyers to bypass government-controlled markets that, among other things, help to ensure farmers receive a minimum price for their crops. The government says the laws, enacted in September, are necessary to modernise the largely state-regulated sector, but farmers fear the new rules will be abused by larger corporate players and endanger the minimum pricing system.
Protests have shut roads and shops across the country, with demonstrators blocking highways and railway lines in several states, but have remained largely peaceful so far.
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Since tens of thousands of protesters, most of them from the nearby states of Punjab, Haryana and Uttar Pradesh, laid siege to New Delhi over a week ago the farmers have had six rounds of inconclusive talks with the administration of Prime Minister Narendra Modi.
Talks between farmer leaders and Home Minister Amit Shah - the highest official to engage so far - have elicited a lukewarm response. A meeting with Agriculture Minister Narendra Tomar that had been due to take place on December 9 was cancelled so the farmer representatives could study an offer by the government.
The draft proposal included a promise to amend elements of the laws but not rescind them altogether. But the protesting farmers want nothing short of repealing the legislation.
"The government is not ready to take back the farm laws," said Hannan Mollah, General Secretary of All India Kisan Sabha, an umbrella body of farmers unions.
THE BONE OF CONTENTION
The Modi administration has passed three laws aimed at modernising agriculture, which employs 40 per cent of India's workforce, and the country's more than 140 million farming households. These are: the Farmers Produce Trade and Commerce (Promotion and Facilitation) Act, 2020; the Farmers (Empowerment and Protection) Agreement of Price Assurance and Farm Services Act, 2020; and the Essential Commodities (Amendment) Act, 2020.
Under the new rules, farmers can bypass government-controlled local markets or mandis and sell their produce to private buyers. Owners of small farms fear this will leave them unable to compete with larger farms that can undercut them on price while private firms could become exploitative..
The legislation also decriminalises hoarding, prompting fears private corporations and middlemen could take advantage of this to corner the market.
Most worrying to the farming community is what they see as a threat to the long-standing system of minimum support price (MSP) - a government-guaranteed procurement scheme introduced in 1965.
This scheme, a linchpin to India's Green Revolution which took India's agricultural output from scarcity to surplus, is essentially a safety net insulating farmers from price fluctuations and providing guaranteed markets.
"These new laws will be a death blow to farmers. Large private corporations will eat the farmers alive if the government gives them a free hand like this," said Prasad, a farmer protesting in the southern city of Bangalore.
Over 85 per cent of India's farmers are smallholders owning less than two hectares of cultivable land and the community tends to view private corporations as predatory.
While the federal government argues the laws given farmers greater control over the prices, protesters fear they lack the firepower to bargain with large companies and say the laws do not have safeguards.
The government has so far stood its ground. "We cannot build the next century with the laws of the previous century. Some laws that used to be good in the past century have become a burden in the present century. Reforms should be a continuous process," Modi said on Monday, without directly referring to farmers' strike.
Indian security personnel stand guard during a nationwide general strike called by farmers to protest against the recent agricultural reforms. Photo: AFP alt=Indian security personnel stand guard during a nationwide general strike called by farmers to protest against the recent agricultural reforms. Photo: AFP
WHY PUNJAB FARMERS IN PARTICULAR?
Punjab has one of India's largest agricultural sectors and farmers from the northern state enjoy the lion's share of the MSP programme, accounting for between 21 and 38 per cent of India's total procurement depending on the harvesting season.
Backers of the new laws argue the reforms will help even out Punjab's dominance and boost other states' farming activities.
Naturally, this has gone down less well with Punjab farmers, who form the bulk of protesters camping on the periphery of the Indian capital demanding the government withdraw the legislation.
HOW IMPORTANT IS AGRICULTURE IN INDIA?
Agriculture, a resource-intensive and region-specific activity, is a politically sensitive and economically complicated subject in India. The livelihoods of 60 per cent of its 1.38 billion people depend on farm incomes.
Agriculture, powered by its allied sectors, is the largest source of livelihoods. Even so, it is plagued by underdevelopment and the suicide rate of farmers in India is among the highest in the world.
Though agriculture's contribution to India's GDP has steadily declined over the decades - in part due to the growth of the services sector - it is still responsible for about 14-16 per cent of the economy.
Electorally, farmers form a massive voter base with the potential to bring down state and central governments. This likely explains why the Modi administration is making a greater effort than usual to placate them.
Farmers carry paddy crop after harvesting a field on the outskirts of Kolkata, India. Photo: AFPP alt=Farmers carry paddy crop after harvesting a field on the outskirts of Kolkata, India. Photo: AFPP
THE POLITICAL COST
Aware of the electoral significance of farmers, Modi's ruling Bharatiya Janata Party (BJP) has departed from its usual practice of not engaging with anti-government campaigners.
Unlike in previous episodes - such as when Kashmir's special status was revoked or the controversial citizenship act enforced - the Modi administration has shown a greater willingness to listen to demonstrators this time around.
Short of a full roll back of the laws, the government looks ready to amend the legislation - again, in sharp contrast to its usual response.
Political observers are keeping a close watch to see whether the protests could snowball into a problem that would threaten the BJP's chances at the next state elections in mid-2021.
Some have compared the protests to the anti-corruption movement of 2011-13, which collapsed the then ruling Congress government in its second term and propelled the BJP to power.
To capitalise on the protests, over 20 political parties, including BJP allies, have expressed support for the farmers and joined the demonstrations.
This article originally appeared on the South China Morning Post (SCMP).
Copyright (c) 2020. South China Morning Post Publishers Ltd. All rights reserved.
