Please note it is not about Rihanna or Greta (although they are wonderful).
I’ve tried not to say much about the Farmers Protest for a while now for a few reasons:
- Most conflicts in India take on religious tensions which often pull away from the real issues.
- I’ve wanted to be more informed and this conflict has taken on a new shape in which again I feel like the original issues of the cause of the conflict have been lost
So having looked into it I thought I’d share my thinking.
As someone who teaches Economics and with family back in India who own farmland I’ve been interested in agricultural policy for a while now, whether it be in the EU or abroad. So to the best of my ability I’ve tried to answer some critical questions in a clear way without oversimplifying controversy. These questions are:
- What are the changes the government wants in place in India?
- Why the government wants to make these changes
- Why the moves are feared by farmers and is it justified
- How the controversy around the farmers protest has moved away from the policy and become about democracy
- Why we should care
1.What are the changes the government wants in place in India?
From my understanding and bearing in mind I am not privy to any of the government papers the 3 big changes to agricultural policy that have been made by the new policies centre around:
- Relationship between farmers and business
- Stockpiling
- Minimum Selling Price (MSP)
So let’s look at these individually:
Relationship between farmers and business – Currently farmers (most of which are from Punjab and Haryana) bring their paddy and wheat to a commission agent in a ‘mandi’ (market place). Produce that meets agricultural standards will be purchased by the government at a Minimum Sale Price assuring that farmers get a minimum price for their product and protecting them. Under new laws although the mandi system is said to still exist the government wants to open it up to private buyers allowing farmers to sell directly to private buyers (such as supermarkets) at a market price.
Further to this, private buyers can influence (and this is the bit that is unclear as to how much influence they have) the farming so farmers tailor their farming to meet buyer demands.
Stockpiling – These private buyers will be allowed to stockpile essential commodities (such as wheat) for future sales something that only really the government has done in the past.
Minimum selling price – The government have assured the farmer that this will continue and is something that allows the famers to rest assured that they will get a ‘reasonable’ price for their goods.
Note: Most countries protect their farmers
It’s important to highlight here that India is not unique in the way it has supported farmers many western countries do the same for instance Farmers in the UK currently receive around £3.5 billion support annually under the CAP (Common Agricultural Policy) something that is being addressed now we have left the EU but is likely to be replaced by other supportive measures. You should also know that the majority of India’s farmers are small “Since the first agriculture census over 45 years ago, the number of farms in India has more than doubled from 71 million in 1970-71 to 145 million in 2015-16, while the average farm size more than halved from 2.28 hectares (ha) to 1.08ha. (Livemint see references at the bottom of the article). In contrast the UKs average farm size according to MacIntyre Hudson is approx. 86.4 Ha. So they are not mass producing crop by any standard and often don’t have the practices and technology in place you might associate with a farm.
2. Why does the government want to make these changes
The current government want to move the agricultural polcies into 2021 in line with it’s growing economy. They have argued the bills will raise farmers income, remove some of the barriers that small farmers (86% of total farmers in India according to the Times of India) face to trading, reduce marketing and transportation costs (often a massive issue in gaining income from farming in India).
3. Why are the changes feared by farmers then?
Well a lot of it is fear about the way these policies will work out and to be honest if we look at the EU alone they have every right to be afraid.
Farmers are claiming that the way these policies are likely to pan out are as follows. Private buyers will lure farmers in with a higher than MSP price away from the Mandi system that has some government protections, until the farmer becomes reliant on the buyer. Then the buyer (supermarket for example) will drop the prices they are willing to pay forcing the farmer to provide goods for a price that is not sustainable and in possibly expecting them to over farm meaning that it destroys their land (in a nutshell you have to use practices such as rotation farming and give the soil time to rest and become rich with nutrients which the farmers believe the buyers will not allow). Further if the farmers try to protest, well they’ll lose their income and the buyers will have stockpiled goods so they’ll be fine whilst they source another farmer. Whilst this is happening the government Mandi system ensuring minimum prices will have packed up because most farmers will have moved to private sales at this point.
Are the farmers right to be scared?
Well let’s look at what is happening in another part of the world. Namely the EU.
As recently as 2017 the EU courts had to intervene to protect farmers in the EU and to help them form cartels and gain bargaining power against the giant supermarkets. This was to address an imbalance in the food chain. The state of EU farmers was pretty poor. Plunging prices in areas such as dairy, meant many farmers went bankrupt. Supermarkets were accused of forcing down prices once a farmer would become reliant on them. How? Well they were accused of attracting farmers by offering them attractive contracts, making larger and larger orders so farmers would become wholly reliant on selling to that supermarket alone and losing other methods of income and then the supermarket would push down prices to the point where it would become financially unviable to run the farm. The horrifying stories that came to light from farmers who eventually banded together to take these businesses to court is saddening (bankruptcies, losing family farms, having to sell homes etc..) so I don’t think we can be surprised that the Indian farmers fear much of the same.
Understand the current system isn’t working either and change is needed
According to The Diplomat many small farmers are on the brink of financial catastrophe. Weather changes, medical bills or a daughters marriage (the dowry system although illegal is still a cultural practice) bring them to the brink of collapse. Many of the smaller farmers don’t have access to fertiliser or technology that would help them increase how much they can farm and sell and to manage quality. Many heavily rely on loans and that’s only if they are lucky enough to qualify bearing in mind many may not even have a credit history. The thing I found most shocking was that ‘in the past decade the bloated debt of Indian agricultural households has increased almost 400% whilst their undersized income plummeted 300%). This makes it obvious that change is needed. However..
You can’t have these free market style policies if you don’t empower people
My biggest concern is that the government is trying to implement free market such as the west but India has other unique challenges:
- In 2018 70% of its rural households still relied on agriculture for their livelihood
- Since 2015 economic reports on the level of illiteracy amongst the farming population has raised concerns and seen as one of the main reasons as to why the methods used in farming have not adopted new practices and technologies. How do we expect these farmers to be able to fight big business?
- Many of the farmers do not have access to loans to secure resources to update their farming methods
If abuse of the system by large corporations does take place in the future how can we expect the farmers to bring about justice? Particularly with literacy levels as low as they are. Free markets are great when there is not an imbalance of power. Farmers currently expect protections from the governments who they have voted into power. But large organisations have a duty to their shareholders to increase profits which usually means buying for as cheap as possible to increase sales. This hurts the farmer.
4. Why we should care
India is one of the largest producers of milk, jute and pulses, what rice, sugarcane, cotton and groundnuts. We all need to support India’s farmers. This is a global issue.
5. How the controversy around the farmers protest has moved away from the policy and become about democracy
Unfortunately, the controversy around the farmers protest has moved away from what’s best for the farmers and towards whether India can really call itself a democracy if it cuts internet access and tries to limit free speech. The name calling between superstars globally has taken centre stage.
What’s not being talked about? The potential solutions to Indian farmers’ problems. And that’s a problem that is not going to go away unless addressed.
You can find my you tube video on the farmers protests here https://youtu.be/m-ebhOFeZDg
Sources of information:
Food and Agricultural Organisation of India http://www.fao.org/india/fao-in-india/india-at-a-glance/en/
Good, India’s Rural Farmers Struggle to Read and Write. Here’s How “AgriApps” Might Change That. https://www.good.is/articles/agricultural-apps-bridge-literacy-gaps-in-india
Politico, Europe rips up free-market rules to help farmers, https://www.politico.eu/article/europe-rips-up-free-market-rules-to-help-farmers-supermarkets-supply-chain/
The Hindustan Times, In Punjab, the centrality of the mandi system https://www.hindustantimes.com/analysis/in-punjab-the-centrality-of-the-mandi-system/story-V1QIJJuShlfDIRiaE7ukQJ.html
Economic Times, Everything you need to know about the new agricultural bills passed in lok sabah, https://m.economictimes.com/news/economy/agriculture/everything-you-need-to-know-about-the-new-agriculture-bills-passed-in-lok-sabha/articleshow/78183539.cms
The Diplomat, India’s bitter seeds the plight of the small farmers, https://thediplomat.com/2017/02/indias-bitter-seeds-the-plight-of-small-farmers/
Uk Government website, https://www.gov.uk/government/publications/food-statistics-pocketbook/food-statistics-in-your-pocket-global-and-uk-supply
BBC News, Farm bills: Are India’s new reforms a ‘death warrant’ for farmers? https://www.google.co.uk/amp/s/www.bbc.com/news/amp/world-asia-india-54233080
BBC, Why are farmers in India protesting and how is Rihanna involved? https://www.google.co.uk/amp/s/www.bbc.co.uk/newsround/amp/55278977
New York times, Why Are Farmers Protesting in India? https://www.google.co.uk/amp/s/www.nytimes.com/2021/01/27/world/asia/india-farmer-protest.amp.html
Live Mint, The land challenge underlying India’s farm crisis, https://www.livemint.com/Politics/SOG43o5ypqO13j0QflaawM/The-land-challenge-underlying-Indias-farm-crisis.html
MacIntyre Hudson, What size is the average farm? https://www.macintyrehudson.co.uk/insights/article/what-size-is-the-average-farm