The government’s decision to repeal the three contentious farm laws may not negatively impact business on the ground because they were not actively implemented in the first place, said industry executives.
"The three farm laws repealed by the central government, were not executed on the ground level like the government had intended when they were introduced in 2020, due to the outbreak of the COVID-19 pandemic and farmer agitations across the country. Hence, their repeal will not have a major impact," a senior official from packaged food major ITC Ltd said.
After a year long protest by farmers, Prime Minister Narendra Modi said on Friday the repeal will be completed in the winter session of Parliament.
The three laws gave farmers the freedom to sell their produce anywhere in the country, sought to destroy the monopoly of Agricultural Produce Marketing Committees, and provide a legal framework for contract farming among other things. The government also proposed to scrap its powers to impose stockholding limit on food items, except under extraordinary circumstances.
With small and marginal farmers comprising over 80 percent of the agricultural class, cultivators felt the contract farming model would be skewed to favour large companies. They also felt this signalled the end of the minimum support price (MSP) system of procurement by the government, the largest buyer of farm produce.
Not everyone agreed with the ITC officer’s assessment though. Officials from sugar companies such as Shree Renuka Sugar Ltd and Bajaj Hindustan Sugar Ltd said that the repeal of the three farm laws is a backward step when trying to move towards a market-driven agriculture economy.
They added that logistical bottlenecks in procurement of raw materials, which the farm laws were going to address, will remain and raw material costs will remain high due to lack of market driven rates.
"Sugarcane procurement rates will once again be determined by central government set prices rather than a market-driven scenario, which was proposed under the now-repealed farm laws," an official said on condition of anonymity.
Others were optimistic of structural reforms emerging from the new committee that has been announced.
"The decision to form a committee to address farm issues would go a long way to identify the actual pain points of the farmers and help the government to make adequate farm policy to enhance the income level of the farmers," Pradeep Multani, President, PHD Chamber of Commerce and Industry (PHDCCI).
This would particularly help marginal farmers who comprise 80 percent of total farmers and hold less than 2 hectare of land, he stressed. PHDCCI is the largest industry association in the northern states of Delhi, Haryana and Punjab.
Farmer organisations also said the move would change little on ground.
"We have to see what happens going forward. But what I believe is that the unions and protestors should suspend the agitation and give the government time to deliver," said Ajay Vir Jakhar, agri policy expert and former Chairman of the Punjab State Farmers' & Farm Workers' Commission.
Jakhar has been longtime Chairman of Bharat Krishak Samaj (Indian Farmers Forum) and said that in case the farmers are not happy, they can return to Delhi before the 2024 national elections.
However, the Samyukta Kisan Morcha on Friday said it will wait for the announcement to take effect through due parliamentary procedures before declaring victory.
"If this happens, it will be a historic victory of the one year long farmers' struggle in India. However, nearly 700 farmers have been martyred in this struggle. The central government's obstinacy is responsible for these avoidable deaths, including the murders at Lakhimpur Kheri," it stressed.
Saying that further decisions will be announced soon, the SKM said the farm agitation was not just for the repeal of the three laws, but also for a statutory guarantee of remunerative prices for all agricultural produce and for all farmers.
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