India’s 1991 Moment for Agriculture Sector — Again?

 Photo by P Sainath

BEFORE the 1991 Economic Reform Bill’s final voting in Lok Sabha, the Indian parliament was treated to vintage PV Narasimha Rao performance. Not only did he speak spontaneously, but also used Sanskrit in his speech, calling out the wisdom behind his decision to introduce foreign investment bill. India was breaking from the shackles of British License Raj and bureaucratic hurdles at that time. In a way, if the modes of functioning of Indian economy were the brain child of Jawaharlal Nehru, PV Narasimha Rao was its modern architect.

The 1991’s 15th July voting was done in a democratic way, where opposition holding its right, decided to walk out. However, as the non-BJP parties clearly did not want the government to fall, the bill was passed after much ado.

Take to 2020 — BJP has now passed three farmer bills in the Indian parliament without and amid protests from the opposition. It was a mockery of the parliamentary form of government.

There has been a concerted effort in the media, both print and electronic, to paint the farmer’s bill revolutionary; comparing it with the foreign investment bill of 1991. Nothing could be far from truth.

Primarily, the circumstances in which the bills were introduced are as different as chalk and cheese. The economic reform’s committee had been working on the bill since 1985, when Rajiv Gandhi first gave the impression that he was serious in giving India’s lagging economy a much needed boost. It is another matter that because of Bofors scandal surfacing in 1987, he couldn’t carry on with his reforms.

This makes it quite clear that the 1991 bill was well discussed, as it should be in a parliamentary form of government. A strong team of economists helped Manmohan Singh draft the bill. The team included Mr Singh, Montek Singh Ahluwalia, P Chidambaram, and Jairam Ramesh — all experts in the field.

Contrary to it, the Farmer’s Bill now, was passed without discussion and with so many loopholes in it that one could fly an air plane through them. Projected as historic reforms, government promises that the bill gives freedom from middlemen who charge commission in the mandis. If that was the case, why are farmers protesting?

In the food bowl of India: Punjab and Haryana, farmers have been completely against the bill. BJP fearing that the agitation may spill over to other states, hurriedly formed a program which will explain the benefits of the bill, the details of which, like many other jumlas, the government of India did not care to provide.

While farmers do agree that the functioning of mandis is regressive and has its vices, yet it’s an important part of the agriculture eco-system. The middlemen are a source of vital link for farmers in terms of information and quick credit as well, at times. This all will all go to nothing in one stroke.

The reforms seem to be a classic case of the centre disempowering the states. The government did not consult states at all. Not only this, the most interesting aspect is that most of the states and UTs already have state laws which allow establishing private markets in the agriculture sector.

It seems obvious then that essentially the government through this bill is taking the power from states, introducing its own private corporate mafia, without any regulation from the government. This means that in absence of regulations, private firms can purchase agricultural produce at cheaper prices. The amendments in the commodity act are also worrisome. They’re highly biased in favor of private capital and limit appeals to any independent grievances. Even as the government is giving assurances on account of MSP (Minimum Support Price), the promises seem to be hollow. On one hand, government is promising free market to farmers, while on the other, it has banned export of essential products like onions.

It will be interesting to see when the rubber hits the road. In a country that is already economically distressed, the farmer’s bill seems to be yet another addition to this government’s ill-conceived policies like demonetization and GST.

Be Part of Quality Journalism

Quality journalism takes a lot of time, money and hard work to produce and despite all the hardships we still do it. Our reporters and editors are working overtime in Kashmir and beyond to cover what you care about, break big stories, and expose injustices that can change lives. Today more people are reading Kashmir Observer than ever, but only a handful are paying while advertising revenues are falling fast.



Faheem Gundroo

Faheem Jeelani Gundroo is an ICT Engineer based in Dubai, with interest in travel, history and current affairs. He can be reached at: [email protected]

Leave a Reply

Your email address will not be published.