Farmers amp up MSP demand in mass protests

NEW DELHI: Scrap the new agriculture laws, which have deregulated the sale of crops, or insert an amendment in the laws that crops cannot be bought by private parties below the government-fixed minimum support price (MSP) – protesting farmers are steadfast in their key demand a week after thousands of them came and sat on Delhi’s border and two rounds of marathon talks failed to break the deadlock.
“It is simple. The government does not want to give legal assurance on MSP. They say no law has ever given that. But no law has also ever given private parties an open licence to procure crops at any price they want,” farmer leader Gurnam Singh Charuni, who is part of the talks, told ET. “They at most say take a letter in writing on that or believe Prime Minister Narendra Modi’s word on the same. We cannot accept this. They have to put it in the laws or scrap them and bring them afresh after consultations.”

Another leader, Darshan Pal, said farmer groups had three months ago rejected a similar letter on MSP issued by agriculture minister NS Tomar to Shiromani Akali Dal leader Sukhbir Singh Badal, who later withdrew his party from the BJP-led National Democratic Alliance. “What if the government changes tomorrow? Will a letter stand up in court?” said Pal.

The protestors said there is a compelling reason why an assurance on MSP is a make-or break for farmers in Punjab and Haryana and why they are prepared to sit for months in the cold at Delhi’s border. Nearly 99.6% of wheat and paddy in Punjab is procured at MSP by government agencies and just 0.4% by private agencies, according to the Punjab government. This amounts to nearly 30 million metric tonnes of crops worth over Rs 60,000 crore procured at MSP every year from Punjab.

This summer, Punjab accounted for 66% of the total procurement of paddy in the country at MSP, with 20.2 million metric tonnes procured for nearly Rs 38,000 crore. Haryana came second, accounting for 18% of the paddy procurement. Punjab and Haryana’s farmers “feel safe” in growing the staple wheat and paddy which is procured at MSP with early payments. About 3.5 million hectares of land in Punjab is devoted to such crops.

While the Centre has said the new laws offer an option to farmers to sell their produce outside the mandis to private parties at a higher price while retaining existing structures of public procurement, farmer groups have expressed apprehensions that the government ultimately wants to do away with public procurement at MSP.

This fear is based on the premise that since Punjab charges 6% (3% as mandi fee and 3% as rural development cess) on each sale in a mandi at MSP and Haryana charges a total of 3% while private parties will charge nothing on this count, business will ultimately get diverted away from the mandis to private players who will then dictate prices. Farmer groups have therefore asked the Centre during talks to ensure private parties also factor in the rural development cess, a demand the government is now considering.

There is also the larger picture of the opposition politics in Punjab, a state where the BJP has little stake in the 2022 assembly election while the ruling Congress, main opposition Aam Aadmi Party and the BJP’s erstwhile ally Shiromani Akali Dal are in a competitive battle to project themselves as the true custodian of farmer interests and pump up the protests. Punjab also has a big revenue stream at stake, as it earns nearly Rs 3,500 crore annually from procurement of crops at MSP.