Now that the political shadow of the three controversial farm laws has been effectively cast aside, a fresh attempt to reform Indian agriculture might be in order. The farm sector is still under dire stress and needs an overhaul. The failed first attempt may have turned the government wary of testing these rough waters again, but a consensus-led approach could get the popular backing it needs to carry reforms through. The three laws revoked in late 2021 were put back in focus last week by findings of significant farmer support by a Supreme Court-appointed panel. While questions have been raised over whether its reading of farm opinion is sufficiently representative, it appears that all-India opposition to the 2020 legislative moves was neither as large nor as wide as farmer protests would have us think. A majority of farmers may actually have welcomed them. Plus, the ruling Bharatiya Janata Party’s victory in four of the five states that went to the polls in 2022 showed a firm vote base in its favour, even if regional hotbeds of the agitation saw its candidates lose. Had specific worry points been resolved, a full rollback may not have been needed.
Unlike labour reforms aimed at offering market flexibility, on which the Narendra Modi government had staked political capital but eventually went for soft options in the face of resistance from workers, convincing farmers of how an open market would work in their favour should not be very difficult. After all, the basic idea of farm reforms was to enlarge their set of choices. What could help, though, is a more participatory approach so that a wide consensus can be obtained. This could be done by giving farmers, including protestors, adequate representation in redrafting laws aimed at granting market forces a greater role in this sector. Also, public feedback should be sought and draft bills sent to a parliamentary committee so that other political parties can offer their inputs. Particular attention must be given to those aspects of the rescinded laws that caused anxiety and drew flak. While their principal aim was to clear a path for the bulk buying, storage and contract cultivation of farm produce by private parties, protestors feared exploitation by corporate players. If state procurement were to wither away, some said, they would be left at the mercy of a few rich overlords. Such fears stemmed in part from suspicions of an oligarchic shift amid perceptions of rising crony capitalism.
Open markets, though, are not as susceptible to capture as critics contend. Apart from proper market openness (even to foreign buyers), fallback cushions and redressal devices could act as assurance. It should be clarified that aggrieved farmers would always have direct access to courts of justice. Also, that the standard rules of market rivalry would apply, so that no private entity gets to dominate farming and cartelized purchases do not saddle farmers with unfair deals. This should be made explicit in India’s competition law, which is set to be amended. Further, the formation of farmer collectives could raise the bargaining power of cultivators and mitigate monopsony risk. All these safeguards should undergo wide deliberation. Agriculture has been stuck with the legacy of a socialist framework even as the rest of India moved on. This has worsened Indian inequality. We must not let our farm sector languish. It needs capital, private inputs and greater freedom of choice to modernize. And the Modi government must make a renewed effort.
