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Busting the myths and fake news regarding Contract Farming

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Anant Chetan
Anant Chetan
An aficionado blogger and an engineer by profession. By qualifications, a Masters in Embedded System Design.

An old friend of mine shared this video (use the hyperlink to navigate to the video) on Facebook, where a man explains why the bills are evil.

I listened to the complete video, and pointed out a number of infeasible and impractical assumptions along with fake news circulated by the video. This video is a classic case of fearmongering. Here are some of the points:

Assumption 1: Each and every farmer gets into contract farming.

He uses this assumption to reach to the conclusion that since all the farmer are involved in contract farming and all the farm produce goes to the private traders, the government will not have any grains and will stop feeding the poor as is supposed to according to the National Food Security Act.

Fact: 23 out of 28 states in India already allow Contract Farming by modifying Model APMC Act 2003, do you see each and every farmer in these states with contracts? Contract farming is an option made available to the farmers and is not a mandatory provision. This contract farming law brings uniformity to the contract farming rules across the country; one nation one market. In fact, National Food Security act as he rightly mentioned, makes sure that APMC Mandis stay relevant even when parallel private markets come into existence. They are the cheapest way any government can procure grain to provide subsidized ration. There is no empirical data to back this assumption. He used an infeasible assumption to create panic in people by establishing that the government will abolish public distribution scheme and kill all the ration shops. The bare fact is that the government cannot get rid of APMC Mandis, even if it wanted to.

Also read: Farm Bills 2020

Fake News 1. With contract farming, the farmer will have to take farming inputs like seeds, fertilizers, pesticides etc. from the trader itself. He would not have the liberty to buy them from other places like he does now.

Fact: With contract framing, the quality and the grade of these farming inputs are decided in the beginning. It no where said in the law that the farmer will have to buy these inputs from the trader itself. Below is the screenshot for the part of the bill that talks about the quality and standards. Where does it say that the farmer has to buy it from the trader? It only says that the trader as well as the farmer should mutually agree to a particular quality, grade and standard.

Let me ask you a very simple question to make it clear. When you were in the school and the teacher asked you to use only A4 size paper for the class project, did it mean that you have to buy it from the school? No, right? You bought it from the stationary nearest to your house. It is exactly the same here, the farmer will have to use a particular grade seed/fertilizer as decided in the beginning with the trader, but he is free to to buy it from where ever he wants. It would be his and only choice where to buy these things.

Fake News 2: The farmers will end up losing their lands to the traders

Fact: The bill explicitly mention that any form of land transfer can not be included in the farming agreement. Moreover, even when a permanent structure is built on the farmers land for whatever purpose, the trader will have to remove the structure at his cost when the contract ends. In case the the structure is not removed the ownership of the structure will be transferred to the farmer once the contract ends.

Assumption 2: No bank will approve any loans for the farmer and the farmer will have to take loans or financial support from the traders.

Fact: As a matter of fact, the bill explicitly mentions that if a farmer needs financial assistance, he can even get it linked to the contract itself. He is free to use any state government or central government scheme.

In fact this is one of the best things. Financial debt has been the biggest reasons why the farmers have been committing suicides. Now with the possibility of linking contracts to the lenders, the farmers will be able to enjoy 3-4% interest rates that the central government provides instead of exorbitant (20-30%) interests charged by the private money lenders including arhtiyas. Of course, the mean money landers are unhappy.

Now, when a farmer is using low interest central government scheme or a state government scheme and a trader cannot add any such clause in the contract, how is the farmer going to lose his land?

Also read: One step closer to Congress Mukt Bharat

Please find a copy of The Farmers (Empowerment and Protection) Agreement on Price Assurance and Farm Services Bill for reference. I don’t know who the man in the video is, he has a lot of other vides on that channel, and all filled with fake news and impractical assumptions.

The truth is that this man is well aware of the bills and is intentionally spreading paranoia amongst the masses. People like him are the reason why there is a chaos. This man is blatantly lying and spreading fake news incessantly.

One another truth is that the old friend of mine that shared this video, after reading my comments did understand that I was making sense. How do I know that? He deleted the share. But not surprisingly, he still continues to promote other similar videos on Facebook.

The fact is that people like these know exactly what they are doing and what the different farm bills mean. There is nothing in the bills that need changing (exception: adding the clause to allow farmers to go to the court for dispute settlement, although, I agree that SDM route is more convenient for the farmers. But since the farmer union asked for it, and the government acknowledged it on Dec 4, it should be appended). The only thing people like these want is a change in a government. They want a spineless government and the old system where the corrupt, cheater, criminal, strongman flourishes and the honest, hardworking suffers. These people had the very same stand for every other major decision the government undertook in the last six or so years. They were against demonetization, against GST, against revoking 370, against CAA, against banning Triple Talaq, so on and so forth.

You should have a look at my article: He turned from being a die hard Modi fan to a Modi hater!!!, you will get a hint as to what is happening.

It is quite straightforward, there are two sides. On one side are the people like these who do not want any kind of reforms and want to keep the “policy paralysis” state as is, on the other side are the people like me, my readers and many others, who want reforms and were fad up of the “policy paralysis” state and don’t what it any more. They are doing to their best to achieve what they want, we also need to give our best to keep what we have. I am doing my part by busting these myths, please help me in spreading the awareness.

Thanks for reading!!! If you agree with me, please do share the article with your friends and family.

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Anant Chetan
Anant Chetan
An aficionado blogger and an engineer by profession. By qualifications, a Masters in Embedded System Design.
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