Draw a red line: Farm unions’ current demands unreasonable. GoI needs to hold firm, push reforms


Samyukta Kisan Morcha (SKM), the joint platform of farm organisations that fronted the protests over the last year, isn’t done yet. The organisation yesterday said that it will continue with its scheduled protest rallies, including ones to Parliament, till its other demands are met. Among a medley of its demands, the most dangerous is the one for a legal guarantee for minimum support price (MSP), and the most outrageous is the call for a repeal of the amendments proposed to the electricity law. GoI has accepted the demand that catalysed farmers’ protest last year by promising to repeal the package of three laws. Now, SKM is being wholly unreasonable and asking for changes that will make India an economic basket case.

MSP effectively works for two crops, paddy and wheat, as they form the foundation of GoI’s food security regime. For a long time, this regime has introduced multiple distortions in the farm economy and also extracted an environmental cost. There is a dire need to reform MSP and move India’s agrarian economy to a system where farmers respond to price signals in making choices. SKM’s approach, in contrast, is to move India towards a de facto nationalisation of agriculture which is a recipe for disaster.

Other demands are equally unreasonable. India’s electricity sector is broken, lurching from one crisis to another. The proposed electricity amendment bill tries to address some of the structural problems and is a matter under discussion between GoI and states, the main stakeholders. SKM appears bent on preserving a status quo mainly defined by free or cheap power. Another demand relates to some provisions of a law that addresses stubble burning. To begin with, stubble burning continues as none of the relevant laws are ever enforced. Here too, the root cause is because of the distortions brought about by the MSP.

GoI had the right intent in its agricultural reform package. Now that it has stepped back, it should draw a red line on the clutch of unreasonable demands. The same Parliament session where farm laws were passed also saw the passage of three labour codes that were part of a year-long effort to consolidate 29 central labour laws. It’s yet to be rolled out fully. GoI needs to hold firm on reform measures or it runs the danger of becoming a lame duck government. It’s necessary to build consensus for reforms but equally important to stand firm in the face of unreasonableness.

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This piece appeared as an editorial opinion in the print edition of The Times of India.



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