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06/11/2021

Why farm bill is being opposed?

Why farm bill is being opposed?

State governments will lose mandi tax, also a huge source of revenue for them, which is why they seem to be opposing the bills. These laws also don’t do away with the old ones and only give farmers options to seek better prices of their produce.

What is the issue with farm bill?

The farmers are protesting against 2 Farm Bills that the Rajya Sabha recently passed: (1) the Farmers’ Produce Trade and Commerce (Promotion and Facilitation) Bill, 2020, and (2) the Farmers (Empowerment and Protection) Agreement on Price Assurance and Farm Services Bill, 2020.

Is MSP good for farmers?

But the MSP announced by the government acts as a signal price for all trade in crops across the country. If the govt had been serious about increasing farm income, it would have strengthened MSP-based procurement.

Why do 6% farmers get MSP?

The government decides the MSP only on the recommendation of CCAP. If the bumper yield of a crop falls, its prices fall, then the MSP acts as a fixed assurance price for the farmers. In a way, it is like an insurance policy to protect farmers when prices fall. Currently, 22 crops are being procured under MSP.

Why are farmers against MSP?

Their demands: The key demand is the withdrawal of the three laws which deregulate the sale of their crops. The farmer unions could also settle for a legal assurance that the MSP system will continue, ideally through an amendment to the laws.

Does farm bills remove MSP?

After harvest, the Centre’s Food Corporation of India (FCI) procures commodities at MSP for use in the Public Distribution System. In practice, MSP and procurement are effective for only two commodities, paddy and wheat. Do all farmers get to sell at MSP? But the bill for the procurement is picked up by the Centre.

Is MSP guaranteed by law?

The first is for repealing the three agricultural reform laws enacted by the Centre. The second is to provide legal guarantee for the minimum support prices (MSPs) that the Centre declares for various crops every year. Currently, there is no statutory backing for these prices or any law mandating their implementation.

Why is MSP not legal in India?

A law barring purchases of the other 21 crops below MSPs by any private trader will also, immediately, fuel high inflation. Every one percentage point increase in MSPs leads to a 15-basis point increase in inflation. Higher MSPs could also upend the Reserve Bank of India’s inflation targets, hurting economic growth.

What is APMC in Kisan bill?

An Agricultural Produce Market Committee (APMC) is a marketing board established by state governments in India to ensure farmers are safeguarded from exploitation by large retailers, as well as ensuring the farm to retail price spread does not reach excessively high levels.