NEW DELHI: A day after the Parliament passed the controversial agricultural reform bills and the opposition urged the President to return the Bills for passage through proper procedure, the Congress on Thursday argues that the abolition of the Agricultural Produce Market Committee (APMC) Act in Bihar in 2006, acclaimed as an important measure to free agricultural markets, did not really work.
In a tweet, Congress leader and party chief whip in Rajya Sabha Jairam Ramesh said the abolition of the law did not break up local trader monopolies, reduce the control of intermediaries, or improve market access and alternatives for farmers.
“A 2019 study by National Council of Applied Economic Research(NCAER) finds that despite the repeal of the APMC Act, private investment in the creation of new markets and strengthening of facilities in the existing ones did not take place in Bihar, leading to low market density. Further, the participation of government agencies in procurement and the scale of procurement of grains continue to be low. Thus, farmers are left to the mercy of traders who unscrupulously fix lower prices for agricultural produce that they buy from farmers,” Ramesh quoted from the study as battle lines get drawn in election-bound Bihar.
Ramesh further cited the study that says inadequate market facilities and institutional arrangements are responsible for low price realisation and instability in prices.
“The abolition of the APMC Act in Bihar in 2006 has led to a deterioration in public infrastructure; not changed the situation for small and marginal farmers who continue to sell to small village-level intermediaries; left a regulatory vacuum in the state and poor public procurement; increased number of intermediaries in some commodity markets to deal with increased risk and not attracted large-scale private sector investment,” the Congress leader and former minister said, on the eve of Bharat Bandh 250 farmer organisations have called against the passage of farm bills.
The Congress said the Bihar experience of abolishing the APMC Act shows that, “it is easier to dismantle institutions than build them. The consequences could be very serious for the farm sector and the farming community.”
Quoting past research on the outcomes of APMC Act abolition, Ramesh cited broad categories as warning signs should the recently passed farm bills become laws after Presidential assent — Deterioration in public infrastructure; Small and marginal farmers have not benefitted; Regulatory vacuum and poor public procurement and increase in intermediaries in some commodity markets.