FARMERS ACT,2020- AN EROSION OF SOCIALISM AND FEDERALISM
Updated: Jan 8
S.Mahadevi , B.B.A., LL.B.(Hons.), Advocate, High Court of Madras
Agriculturalist is the linchpin of the world for they support all others who cannot till the soil.
India is bestowed with huge fertile landmass suitable for agriculture and so 60% of the population in India are indulged in agriculture. We all know that agriculture plays a vital role in the Indian economy as it contributes to almost 15% of the GDP of India. However, due to rapid industrialisation, agricultural lands are being converted into commercial lands which are a bad-sign for India since agriculture is the backbone of India.
To enhance the agricultural sector, ruling Government has enacted three acts namely i)The Farmers’ Produce Trade and Commerce (Promotion and Facilitation) Act, 2020, enable the farmers to sell their harvest outside the notified Agricultural Produce Market Committee (APMC) mandis without paying any State taxes or fees; ii)The Farmers (Empowerment and Protection) Agreement on Price Assurance and Farm Services Act, 2020, advances contract farming; iii) The Essential Commodities (Amendment) Act, 2020, decontrols the production, storage, movement and sale of several major foodstuffs, including cereals, pulses, edible oils and onion, except in the case of extraordinary circumstances. Unfortunately, the above-mentioned acts look perfect in the paper but remain unrealistic when comes to practical application in the prevailing agricultural sector especially in a country like India. Thus in this article, the author connotes as to how the Farmers Act, 2020 could vanquish Socialism & Federalism and its toll on farmers.
FALLACY OF FARMERS ACT, 2020
Farmers act, 2020 looks like empowering the farmers to the next level but actually, it will make the situation even more worst. The following points discuss the myth of Farmers Act,2020.
APMC MANDIS – COUNTING ITS LAST BREATH
First reason, Farmers produce an act, 2020 allows farmers to sell their produce inter-state and intra-state[i] without the aid of mandis in the locality.
Even in the prevailing State’s APMC Acts there is no geographical restriction which accounts for free-trade in line with Competition Act and this proves that the Farmers Act, 2020 is a new wine in the old bottle. States like Punjab and Haryana are yielding Rs.3,500crores through revenue from these mandis yearly and therefore diluting the powers of APMC mandis will have a toll on State’s economy. Contract Farming act will ultimately lead to the closure of such mandis as it involves direct marketing between the farmers and corporate sectors.
NO TO ‘MSP’ IN THE ACT- A BOOK WITHOUT CONTENT
Secondly, the major lacuna in the acts is that it has nowhere mentioned about the Minimum Support Price which permits the giant-private players to exploit the farmers. For instance, in Bihar, the farm produce is sold below the value of MSP where there is no APMC and MSP system which shows that a system without MSP will put the farmers in more trouble for their livelihood[ii]. Moreover, permitting corporate electronic traders to procure farm produce directly[iii] will initially seem to gain farmers but later the same corporatisation of farming will push the farmers into deep-pit of exploitation. To elaborate, the electronic traders like Jiomart, Amazon, Bigbasket etc. perhaps gives a proper price for the harvest initially yet in a long-run they shall reduce the price rate below MSP to adjust their profit margin (to compensate their offers/reductions provided in the electronic application) and farmers have no other options expect to agree with the low price of the big-dealers as the farmers have no upper hands to protest them.
Eventually, farmers shall lose their bargaining power.
FARMING AGREEMENT – A TRAP
Thirdly, “farming agreement” needs to comply with the predetermined and mutually acceptable quality, grade and standards of farming produce[iv] and this may pave the way for the sponsors to make flimsy excuses and refuse the yield or re-negotiate the price. Also, the climatic condition of India makes it even more cumbersome to produce the harvest of such quality. In toto, the farmers who are the linch-pin of India are the losers.
DSP- A ROAD WITH PITS
Dispute Settlement Body is not properly established[v] in the Act as provisions enable the farmers to approach officials for dispute resolution instead of courts [vi]which violates principles of natural justice. In foroconscientiae, protecting Sub-Divisional Magistrate for taking action in good faith[vii] impliedly legalises any arbitrary decision and the corrupt act of SDM which is against the principles of equity.
ECA,2020-ON THE ROAD TO RUIN
The objective of the Essential Commodities Act is to prevent hoarding and black marketing of foodstuffs. However, ECA,2020 deregulates the protocols of production, storage, movement and sale of several major foodstuffs, including cereals, pulses, edible oils and onion, except in the case of extraordinary circumstances. It impliedly legalizes hoarding which is against the basic tenet of social justice and the basic structure of the Constitution. And the concept of price trigger under section 3(1A) found to be unrealistic. Consequently, the amendment is self-destructive of its objective.
ECONOMIC RAMIFICATION OF FARMERS ACT,2020
The dogmas of Farmer’s Act,2020seems to have its base from Invisible Hand Theory[viii]. However, there is a thin thread of difference between invisible hand theory and stimulating capitalism. Indeed, the canons of this act have its root from Trickle-Down Theory and Horse And Sparrow Theory which is certainly vicious and have a toll on farmer’s economic justice as it supports capitalism under the veil of free-trade. Additionally, ‘one nation one market’ perhaps seems to be interesting in the paper but practically it is difficult to implement it in the Indian market as the Indian economy is a Sticky economy. Finally, the ECA amendment shall have an impact on inflation management and trade policy decisions and also by abolishing mandis leads to unemployment. In a long-run, privatisation of agriculture shall lead to scarcity of foodstuffs, infertility of fertile lands and ultimately irregular regulation of export by big-companies can ruin the natural- farm produces assets of India.
PRIVATISATION OF AGRICULTURAL SECTOR- AN INJUSTICE TO SOCIAL JUSTICE
Current government’s ideology of ‘Minimum Government Maximum Governance’ clearly implies the road for privatisation which in-turn gives rise to capitalism automatically. Having said that Corporatisation of farming in a long run will make the farmers as slaves to the private companies and it is an undeniable truth because 85% of farmers in India are marginal farmers. Also, the unregulated market will result in the hoarding of farm produce by private companies which have an adverse effect on the quality of foodstuffs. As a consequence, cartel adventurism, price-fixing and hoarding would be predominant due to benevolent legislation of Farmers Act, 2020 by the State in favour of privatisation of agriculture. Eventually, inequality and corruption will reach its peak and goes beyond the control of the government. Moreover, the constitution of India imposes the duty to the state under article 39(b) and (c) to ensure social justice to its citizen and hence, privatisation will certainly have an adverse effect on farmers accessibility to social and economic justice. As said by Samantha v. State of Andhra Pradesh[ix], “social justice is the yardstick to the justice administration system”, the state should ensure social justice to farmers without prejudice. Eventually, by this Act,2020, the word socialist in the preamble to the constitution of India has been vanquished as the backbone of the state (i.e., agricultural sector) is not under its control now.
FARMERS ACT- A VAMPIRE TO FEDERALISM
Federalism is a separation of powers between the centre and the state to function within their competent spheres of powers. In S.R.Bommai vs. Union of India[x], federalism had been declared as part of the basic structure of the constitution of India. And inManeka Gandhi vs. Union of India[xi], held that no act of the Parliament can be considered a law if it violated the basic structure of the constitution i.e. federalism here. Under the constitution, VIIth schedule contains three lists namely, i)union list, ii)State list and iii)Concurrent list which has its root from Part-XI especially article 246(union list) and 254 (concurrent list) of the Constitution of India. Generally under VIIth schedule, the state list entries 8,14,18,28,30,45,46,47and48 deals with agriculture. But the union and concurrent list put the matters relatable to agriculture out of the purview of Parliamentary jurisdiction and it certainly gives absolute power to State Legislature for enacting matters concerning agriculture.
When Farmers Act, 2020 is concerned, parliament has not mentioned in its objective nor in its statement regarding under which article of the constitution does it gains power and enacts Farmers Act, 2020. Even the parliament cannot take its recourse to article 369of the Constitution of India since it is temporary. But Central Government vindicates its enactment by deriving power from entry 33 of the Concurrent List of the Constitution of India. However, foodstuffs mentioned in entry 33 shall not include agriculture as it is a profession and hence cannot falls under the ambit of entry 33 of the VIIth Schedule to the Constitution of India. If foodstuffs are construed as agriculture then all the entries in State list relating to agriculture will make no sense.
In ITC v. State of Karnataka[xii], raw material or activity that does not involve manufacturing or production cannot be covered under industry. The above case makes it crystal clear that agriculture cannot be equated as foodstuffs or industry. If the parliament uses the Union and Concurrent list largely for the enactment and touches upon the State list incidentally, then such act can be upheld[xiii] by detecting it with the tool of the doctrine of pith and substance[xiv]but in the instant issue, the Farmers Act,2020 has gone beyond it which ultimately amounts to colourable legislation[xv]. Hence, Farmers Act,2020 is a cumulative erosion of State powers and depicts the side-stepping of democratic operation.
CONSTITUTIONALITY OF FARMERS ACT,2020
Constitutionality of Farmers Act,2020 can be challenged only with regard to competence and violation of fundamental rights as per article 13 of the Constitution of India. The Centre has no competency to enact anything relating to agriculture which is under State list of VIIth schedule to the Constitution of India and hence unconstitutional.
Secondly, the instant act violates article 14,21and 23 of the constitution of India as it arbitrarily removes all the protection provided to the farmers. FTPC Act violates article 23 read with article 14 because the act demotes the equality of status and opportunity of farmers.
As a consequence, the farmer’s choice will be cast away and their labour will be exploited per se. Also, the farmer’s right to life, self-dignity and livelihood will be questioned due to this farmers act, 2020 which is a fundamental right guaranteed under article 21 of the constitution of India. Ergo, Farmers Act,2020 is constitutionally invalid and ultra vires to the constitution of India.
VIOLATION OF DOCTRINE OF BASIC STRUCTURE
According to KeshavanandaBharti vs. State of Kerala[xvi], socialism[xvii], federalism[xviii], equality[xix] and judicial review[xx] has been declared as the basic structure of the constitution of India. And the Farmers Act,2020 infringes the basic structure of the constitution of India as the Act,2020 overthrows welfarism&syndicalismand hence it is unconstitutional.
INFRACTION OF PRINCIPLES OF NATURAL JUSTICE
Farmers Act,2020 came into force arbitrarily by using the pandemic situation without hearing the opinion of the farmers and opposition parties which is essential in a democratic country like India to follow the principle of audialterampartem. Moreover, the national wide protest took place for scrapping the inconsistent Farmers Act-2020 and the same has been challenged for its constitutionality in the Supreme Court of India now as judicial review is the basic tenet in a democratic country like India.
According to the author, MSP should be legalised for all crops even for private mandis and it happens only by empowering farmers than the private corporations through stringent rules by the State. If there is any flaw in already existing ‘well-established APMC mandis’, reforms can be made accordingly to meet the needs but it should not be removed as it is palatable that Indian economy is a sticky economy and each State’s regional condition is different from each other so according to the contemporary situation prevailing in each State, States shall make amendments to APMC Act. We all know that investment in the agricultural sector is indispensable, hence, investment should be made from the government or government-controlled institution and not from the private sector as private companies will ultimately look for profits but not for the welfare of the farmers which could defeat the basic fabric of principles of social justice. The pen is mightier than sword so the parliament should rethink twice before implementing this act for the greater good of the society at large. Liberalising the agricultural sector perhaps harms the back-bone of the Indian economy and tears away the farmer’s fundamental freedom. Ultimately, nothing about us without us has to be taken into account before any such legislation by the State as a republic in the preamble which is an integral part of the constitution is saluspopulisupremalexesto.
[i]The Farmers’ Produce Trade and Commerce (Promotion and Facilitation) Act, 2020,Section 3, no.113Acts of the Parliament, 2020(India)
[ii]Research by National Council of Applied Economic Research, November 2019.
[iii]The Farmers’ Produce Trade and Commerce (Promotion and Facilitation) Act, 2020,Section 9, no.113, Acts of the Parliament, 2020(India)
[iv]The Farmers (Empowerment and Protection) Agreement on Price Assurance and Farm Services Act,2020, Section 4, act no. 20, Acts of the Parliament, 2020(India).
[v]The Farmers (Empowerment and Protection) Agreement on Price Assurance and Farm Services Act,2020, Section 13, act no. 20, Acts of the Parliament, 2020(India).
[vi]The Farmers (Empowerment and Protection) Agreement on Price Assurance and Farm Services Act,2020, Section 19, act no. 20, Acts of the Parliament, 2020(India).
[vii]The Farmers (Empowerment and Protection) Agreement on Price Assurance and Farm Services Act,2020, Section 18, act no. 20, Acts of the Parliament, 2020(India).
[viii]Adam Smith, Wealth of Nations,19 (W.Strahan AND T.Cadrell 1776).
[ix]AIR 1997 SC 3297.
[x]AIR 1994 SC 1918.
[xi]AIR 1978 SC 597.
[xii]AIR 2005 Kant 330.
[xiii]State of Rajesthan v. G.Chawla, AIR 1959 SC 544.
[xiv]Prafulla Kumar Mukherjee v. Bank of commerce, AIR 1947 PC 60.
[xv][xv]Reports K.C. Gajapati Narayan Deo and other v.The State of Orissa, AIR 1953 SC 375.
[xvi]AIR 1973 SC 1461.
[xvii]Samantha v. State of Andhra Pradesh, AIR 1997 SC 3297.
[xviii]KeshavanandaBharti vs. State of Kerala, AIR 1973 SC 1461.
[xix]Indira Nehru Gandhi v. Shri Raj Narain&Anr., AIR 1975 SC 2299.
[xx]Minerwa Mills v. Union of India, AIR 1980 SC 1789.