What Are the Effects of the 2020 Farmers Bills?

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Farmers have been protesting since mid-September against the three farm bills. The bills aim at giving freedom to the farmers on one hand and might even grab their livelihood through another. The protests are spreading throughout the country from the epicentre Punjab and Haryana.


Agriculture contributes to the major chunk of India’s economy, be it GDP or employment generation. It is one of the sectors which was not adversely affected during the pandemic. But even this sector is not spared from the plethora of failed regimes. The bills come as a black chapter to the agriculture sector. Farmers are the backbone of the country. They feed the nation. But they are facing a threatening situation through these bills. The Parliament has failed everyone in the country. Farmers should have been spared, but they are also pulled into the pandemic of failures. These bills are supposed to make the present agricultural sector more remunerative. That comes at the cost of the welfare of farmers. There are a lot of issues with the bills. The timing of the bills being one of them. While all other nations are focussing on the pandemic, our nation is focussing on reforms. The reforms, which can wait and, in some cases, not even necessary. The opposition terms the bills as “death knell to the future farming”. The phrase sums up the aftermath of the bills.

The story so far

The three farm bills are aimed at reforming the farming of India. The three central laws are promulgated through ordinances in June this year. These are the source of farmers’ protests. The three laws are the Farmers’ Produce Trade and Commerce (Promotion and Facilitation) Ordinance, the Farmers (Empowerment and Protection) Agreement on Price Assurance and Farm Services Ordinance, 2020, and the Essential Commodities (Amendment) Ordinance. All these three ordinances have been passed by the Rajya Sabha in the monsoon session among lots of protests and ruckus. The very first one is the bill on the agriculture market and talks about the freedom of selling the product to anyone rather than the government and state-recognized mandis. The second bill talks about contracting and pre-agreed prices. The third bill is about excluding agricultural products like cereals, pulses from essential commodities.

The first bill especially gave rise to protests all over the nation. Farmers say that they don’t see any other alternative except for suicide in such pathetic situations. The government as usual pays no heed to such cries and terms all this as a way of saving farmers. The government is saving the farmers from the so-called “monopoly of the government”. The epicentre of the protest in Punjab and Haryana.  It spread like wildfire throughout the country as every one of the farmers is going to face the heat. These protests are first of its kind, where every farmer came together irrespective of religion, caste, creed, place. Women and students also led to some protests.

Amid these protests, President Kovind gave his assent to all the three bills on September 27, 2020. This would have a very catastrophic effect on the economy of the country as well as on the farmers. But the government also had a loss, a very minute one but not ignorable. The NDA lost its oldest ally, Shiromani Akali Dal(SAD).


The bills have got the final nod from the President, they are proper laws now. They are legal statutes that are very much flawed. These amendments and laws show the black days of Parliament. Even the voting to the bills is flawed, none of the opinions of opposition members is considered. On the whole, democracy is a threat. The Prime Minister needs to understand democracy in its true sense. While many from the government who are supporting the bills and claim that they are helpful for the farmers, but farmers do not see any advantage. It is not the misconception of farmers but the bills, in general, are flawed. One of the first noticeable lacunae and the reason for all the protests is the missing minimum support price. The bills as such do not provide for the stopping of government procurement of the produce at MSP. But the speed with which the government is operating about these bills and everything going around it is so contentious. And this leaves a huge space between reality and what is on paper, these fears are valid for the farmers who apprehend this might be the situation. Nevertheless, Prime Minister clarified the same on twitter by stating that government procuring and MSP is to stay. And many of the ministers clarified that the bills will be a way to provide an extra channel for farmers to sell their produce. Then what is still bothering the farmers?

There are many provisions in these bills which are not yet clarified and which might be a disadvantage to the farmers. Especially what comes under the definition of the trade area. The very first bill talks about the freedom to sell to any private buyers other than the state-regulated mandis. This freedom might be very much required for the farmers but how the bills are brought into force is not the correct way. The government should have consulted the farmers before taking such big reforms. It has been decades trying to reform the politicized mandi system. But now is just not the right time. Mandis and market yards are one of the important players in the ecosystem of farming transactions. Although the farmers might not get profit they are always in a better position, they have more information. By which they can make an informed decision. But this is not the case with private buyers. When farmers enter into contracts with private buyers or companies for that matter they never get what they require, they are always paid what is convenient for the companies. They are always at a loss due to information asymmetry.

One of the other contentions is that agriculture is the subjects of the state list and the center should not concern itself with agricultural sector reforms. Considering the same these bills in the future can be challenged as unconstitutional. On the flips side, the government still believes these bills are to benefit the farmers. The government should have at least defended itself by explaining the contentious parts of the bills.


The repercussions of these bills will reverberate throughout the country for a long. We do not know up to what extent these could take us either on the good scale or the bad one. But if they do not function according to the claims of the Government, the after-effects are not so good. The after-effects could go way back to the Zamindari system and even worse, the Zamindars might be the corporations. Corporations seem to take up a major part of everyone’s life these days and they do have a huge impact on every life in a country like India. In such situations, you do not want the lifeline of the country in the hands of corporations. Another possibility would be contract farming and corporations ending up as middlemen and securing half of the produce. This not only affects farmers but also people on the whole. All these do not seem to reduce the burden on the farmers but seem to bring collateral in each case. These bills do not give freedom to farmers but capital.


It is very hard to protest in these pandemic times. We should hope for the betterment and health of the farmers, who would feed us. Before the protests ruin the farmers and the people the government needs to take immediate action and reach out to farmers. There are many suggestions being given, many say the revenue of the states is also affected due to such decisions by the centre. These bills might have the effect of nullifying the whole progress of the agricultural sector since independence. The fears valid and worrisome, farmers are uncertain and are put in the dark. They should not be the distressed party in a contract. As the government claims the bills have nothing to do with MSPs, but they should have added a clause stating that the prices at which private buyers procure should be greater than MSP. Among all this ruckus, to stop the agitating farmers’ center ordered immediate procurement of the paddy. All we can hope for is this should work out as the government claims it will and should not be another regime that is unplanned for. The bills should not “reform” but reform the agricultural sector.

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