Know about The Farm Laws in India

Table of Contents

Introduction to Farm Laws in India

India is one of the largest supplier of Rice and spices in the global market .India is a member of World Trade Organization (WTO), Food and Agriculture Organization of the United Nations (FAO) and International Plant Protection Convention (IPPC). India’s most recent national agriculture strategy was launched on July 28th, 2000. Equitable inclusive growth and sustainability in terms of effective resource usage are its main objectives. Its goals also include worldwide competition and scientific and technical advancement. The policy encourages the use of biotechnology for growing plants that Consume less water, drought-resistant, pest-resistant, more nutrition, Provide higher yields and are environmentally safe.

Recently there was a shortage of rice in India due to 40% decline in rainfall in major rice producing states like Uttar Pradesh. now, due to less supply and more demand the price of rice should increase but Indian government did not increase the price in India but reducing the global supply of rice, this also happened in 2008 when India blocked its rice exports, which lead to price of One ton of rice went to 1000$ .This strategy is also copied by second and third largest producer of rice such as Vietnam and Thailand, this is what can be called as rice politics with artificial inflation on global level.

The policy of India also promotes environmental protection technology through public research and proprietary research. India’s agricultural exports are expected to reach $60 billion by 2022 according to the 2018 Agricultural Export Policy. Several reforms are being considered in the agriculture sector as part of COVID-19 (Atmanirbhar Bharat Abhiyan) alleviation efforts to make India the “food basket” of the globe, including: The establishment of an agri-infrastructure fund of approximately USD15 billion (post-harvest infrastructure).

An initiative of 10,000 farmer-producer organizations designed to provide farmers a platform.
Building a digital agri-stack to support smart agriculture and online marketplaces.
Recently, India came with new farm laws that were widely discussed globally and have protests and discussions. These new laws were introduced for the upgrade to the small-scale farmers who has to bargain to sell their product or cannot invest huge on technology based agriculture

Constitutionality of Farm Laws

India is expanding rapidly, and with it, so is the use of technology in the country’s expanding industries. A sizable portion of the population still relies on agriculture as its primary source of income. Ever since independence, India has been engaged in an ongoing relationship with its agricultural infrastructure, methods, and affiliated organizations. India has been driving essential and timely interventions at Industry, Institution, and Individual Farmer level for its constant manifestation. The sector has still been contributing approximately 15-20% of the country’s national GDP, and its different combined changing demands across its territories. Since the general public is emotionally drawn to the agricultural sector, Indian agencies are compelled to implement legislative measures to stimulate the industry landscape by enhancing credit access and expanding the reach of crop insurance. Creating and enabling institutions to further mobilise critical agro services and new-age technological production inputs, empowering individual farmers through incentives like subsidies on input resources along the farming value chain, and improving their social security conditions.

Given the different needs of farming in India, it is essential to take steps or implement interventions to serve the greater farming community. The productivity of a farm may be hampered in the long run by a single constructive modification of the current policy or by the incorporation of new clauses to benefit the expanding aspirations or expectations of any farmer. For instance, higher farmer group subsidies for chemical fertiliser purchases could have a negative long-term impact on soil health, which would also have a negative year-over-year impact on a farmer’s cash flow.

Newly developed technological tools like the nation-wide soil testing facilities have had a significant impact on farmers’ crop selection, crop rotation strategies, level of mechanisation, and irrigation system choices. Micro land holdings are a problem for farming in India since they restrict any farmer’s ability to practise mixed farming, switch to growing several crops at once, or even embrace novel crop-growing techniques. In order to lessen the burden of informal setup in agriculture and allied services, the government has been aggressive in recent years in building the best platform and implementing necessary procedures. Encouragement of Farmer Producer Organizations across the nation is one such initiative that has benefited and inspired the farming industry as a whole.

Farmer Producer Organizations are established in accordance with the State Cooperative Act or the Statute of Corporations Act. It operates under a very creative organizational paradigm that relies on the combined and crowd sourced efforts of like-minded farmers from a certain area or who raise similar crops. FPOs¹ have proven to have a good impact on all the participants and activities of the farming value chain throughout the years, even though they were initially intended by a group of farmers to improve marketing methods. In the meantime, farmers are better able to deal with inflationary pressures, increase processing and storage capabilities, experiment with and implement different farming techniques broadly speaking, and have better access to formal sources of financing thanks to this manner of BAU².

Let us understand the 3 bills which caused the chaos³

Farmer’s Produce Trade and Commerce (Promotion and Facilitation) Act, 2020

Due to varied state Agricultural Produce Marketing Committee legislation, this act permits farmers to exchange their agricultural products outside of actual markets. It will supersede all APMC acts at the state level and is also referred to as the “APMC Bypass Bill.”

Encourages the exchange of agricultural products between states without any restrictions. It proposed an electronic trading platform enabling produced goods to be traded directly and online. Companies, partnership firms, or societies are examples of entities that can create these platforms.
Gives farmers the ability to conduct business anywhere they like, including at farm gates, warehouses, cold storages, and other locations outside of APMC marketplaces that have received governmental notification. Prohibits levying any fees, cess, or other charges on the produce of farmers by state governments or APMCs.

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Farmers Producer Organisation 
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business as usual
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The farms act, India. Available at https://idronline.org/the-farm-bills-all-you-need-to-know (last visited on 4/10/2022)

Farmers (Empowerment and Protection) Agreement of Price Assurance and Farm Services Act, 2020

The legislation aims to give farmers a framework for contract farming, in which they can directly contract with a buyer (before the sowing season) to sell them the harvest at pre-set pricing.

“Sponsors” are defined as entities that may reach agreements with farmers to purchase agricultural products; these entities can include people, businesses, partnership firms, limited liability groups, and societies. The act enables sponsors and farmers to establish farming contracts. The agreement must specifically indicate any other parties (such as aggregators) engaged in the transaction. State governments may establish registration agencies to offer electronic farming agreement registration.
Agreements may include conditions that have been mutually agreed upon by farmers and sponsors and may address issues such as supply, quality, standards, price, and farm services. These include the provision of seeds, livestock, fodder, agricultural chemicals, equipment, and other farming inputs.
agreements must last at least one cycle of livestock production or one agricultural season. Five years is the maximum allowed time frame. The length of the agreement may be determined upon by the sponsor and farmer in the case of production cycles longer than five years.
The agreement may also include the methodology for establishing the purchase price of the farm products. The contract must specify a guaranteed price to be paid in the event that the price is variable as well as specific references to any additional payments the farmer might get, such as a bonus or premium. The minimum support price (MSP) that buyers must provide to farmers is not mentioned.
Within the set time range, either party may deliver the farmers’ produce. Sponsors must check the items’ quality in accordance with the contract; otherwise, they will be assumed to have checked the production and must accept delivery within the predetermined time limit.
There is no room for states to impose MSPs on produce produced under farming agreements because it is exempt from any state laws intended to regulate the sale and acquisition of agricultural products. The sponsor is also released from any stock-limit restrictions imposed by the Essential Commodities Act of 1955 by such agreements. A technique for preventing the hoarding of agricultural goods is stock restrictions. Provides for a three-level dispute settlement mechanism: the conciliation board (comprising representatives of parties to the agreement), the sub-divisional magistrate, and the appellate authority.
Sponsors are required to pay at least two-thirds of the agreed-upon price at the time of delivery in the case of seed production, with the remaining amount to be paid following proper certification within 30 days of the delivery date. For all other situations, full payment is required at the time of delivery along with the issuance of a receipt form outlining the specifics of the sale.

Essential Commodities (Amendment) Act, 2020 This act

which modifies the Essential Commodities Act of 1955, aims to limit the government’s ability to produce, supply, and distribute a number of essential commodities.

Cereals, legumes, oilseeds, edible oils, onions, and potatoes are no longer considered to be essential commodities under the legislation. Under this Act⁴ of 1955, the government may only restrict stock ownership and control the prices of the aforementioned commodities under unusual circumstances. These include major natural disasters, war, starvation, and unusual price increases.
Stock restrictions on agricultural products will be determined by market price changes. They can only be enforced if there is:
1. A 50% increase in the retail cost of agricultural non-perishable food products. It is necessary to determine the increase above the price that prevailed over the previous 12 months or the average retail price over the previous 5 years, whichever is smaller. A 100% increase in the retail cost of produce from horticulture.
The measure intends to allay private investors’ concerns about regulatory interference in their commercial activities. Gives producers the flexibility to grow, store, move, distribute, and provide their own food, which encourages private sector and foreign direct investment in agricultural infrastructure.
Essential commodities act

Case Laws on Agriculture Law

One of the main case law where patent act was used to determine the originality of a crop is a landmark case.

Pioneer overseas corporation vs. chairperson⁵

The Patents Act of 1970 protects the plant variety owned by the petitioner in this case. Pioneer alleges that KMH50 is identical to or comparable to its 30V92 variety of maize, hence Kaveri has misappropriated Pioneer’s 30V92 variety’s genetic material. The results of the DUS⁶ test report were the only criteria used to accept Kaveri’s application for registration of its variety. This led to questions being raised about the registration process as well.

Pioneer not only submitted an opposition to Kaveri’s variety’s registration application, but it also provided evidence that the two kinds are 99.45% to 99.80% alike. In order to prove its claim of germplasm theft, it has also submitted an application under Section 24(5) of the Act for the permission to undertake a specific test (DNA test) to ascertain the genetic similarities of KMH50 and 30V92. Additionally, it was asserted that Kaveri had misused the clause by making fraudulent declarations and giving inaccurate information.

In response to these points, Kaveri did not explicitly say that they will file a counter statement, question the validity of the technical evidence, or establish the legal creation and ownership of KMH-50. The Registrar stated that the two kinds met the DUS requirements after the test was completed, negating the need for a specific test, which was rejected by the court. Then it said that both types might be registered.

But after looking into whether Pioneer’s opposition needed to be rejected just because Kaveri’s variety KMH-50 passed the DUS Test, the court determined that the answer to this question was categorically no.The court read Rule 29 to mean that anyone who feels they have been wronged may request a special test, including anyone who wants to register a plant variety but can’t pass the DUS test or anyone who wants to challenge or protest the registration of a candidate variety. The court determined that the registrar’s reliance on rule 29(1) in rejecting the request for a special test was incorrect.

Pioneer Overseas Corporation vs. Chairperson, Protection Of Plant … on 1 July, 2019 in the High Court of Delhi at new Delhi

Distinctness, Uniformity and Stability –A testing is a way of determining whether a newly bred variety differs from existing varieties within the same species

Pioneer’s request for a special test was then reinstated in the Registrar’s file. Based on the findings of the DUS tests, the Court initially decided that both varieties’ traits met the requirements for the test and that they were almost identical to one another when compared inter se. According to the aforementioned, the Registrar’s orders that Kaveri cannot apply for registration and that the special test as requested by Pioneer be restored to the Registrar’s file were set aside by the ACC. As a result, the parties were left to cover their own expenses.

Conclusion

The farmers feared the decline in MSP minimum support price and that huge companies will give them too low price for their goods, the middleman who used to give loans were also will be out of business under this model. The farmers wanted to removal of the three farm laws. The farmers wanted to make in amendment in the laws that there will be exist MSP system. They feared that there will be removal of electricity subside hence they also wanted to remove electricity amendment bill (2002). As it was announced that sate run CACP for lot of commodities on annual basis after cost of cultivation. The FCI sells the excess food grains at highly subsidised rate to poor and thereafter compensated by the government for its loss The main agenda of the government was to let the farmers sell anywhere in the country without the involvement of the middlemen or anyone else.