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Subject: Agriculture

  • Power sector reforms: UK lessons for India

    Reforms in power sector in the UK were extensive and offers some important lessons for India. This article elaborates on the issue of reforms the challenges in introducing such reforms in India.

    Background of the power sector reforms in UK

    • After living with vertically integrated utilities till 1989, they unbundled.
    • Unbundling created markets both at generation and retail end.
    • Today, they are back to a situation where 70% of the power generated is sold outside the wholesale market.
    • The Electricity Act, 1989, which paved the way for the appointment of a regulator and thereafter, leading to unbundling, both vertical and horizontal.
    • Twelve distribution utilities were set up (called RECs) along with three-generation companies and also a national wires company (called NGC).
    • All of them were privatised barring Nuclear Electricity.
    • Retail competition was introduced in 1990 and was extended to all consumers in 1998.
    • A wholesale market was set up for generators.
    • The next major step was to fragment the generators because the regulator felt that they were colluding.
    • NETA in 2001 was primarily a tie-up between gencos and their consumers with long-term power purchase agreements.
    • The Energy Act, 2012, was enacted, which envisaged further changes.

    Issues with Power sector reform in India

    • The Electricity Act, 2003 is a very cautious and timid exercise compared to what has been done in the UK.
    • Through the Act, we have merely unbundled and ring-fenced our utilities so that there is transparency in the accounts; this itself took us several years.
    • There has been no attempt to create a wholesale market or a full-fledged retail market where the consumer chooses the supplier.
    • Large consumers, having loads in excess of 1 MW, however, have the option of open-access where they can opt to receive supply from some other entity, instead of his incumbent utility.
    • The road to open access though has been bumpy, and discoms have opposed it tooth and nail.
    • Besides what was possible in the UK may not be possible in India.
    • The UK did not have a regime of cross-subsidies where the commercial and industrial sectors subsidise agriculture and low-end domestic consumers and also did not have high commercial loss levels.
    • Moreover, in the UK, all consumers were metered, unlike India.
    • There is yet another factor: ‘Power’ falls in the Concurrent List.
    • The Centre and states rarely see eye-to-eye on several issues concerning the sector, especially on matters relating to distribution.
    • Consequently, any major change does not get accepted.

    Issues in introducing reform in India

    • The CERC floated a discussion paper in December 2018 about the creation of a wholesale market in India.
    • This amounts to retrofitting, and retrofitting in an existing architecture has its limitations.
    • But the issue is whether India should attempt creating a wholesale market or for that matter a full-fledged retail market in India, especially after the experience of the UK.
    • The UK is almost back to the era of vertically integrated utilities, and consumers barely switch their retailer.

    Way forward

    • We need to privatise our distribution sector by creating joint ventures with the government.
    • the government will have to undertake initial hand-holding till such time commercial losses are wiped out.
    • This is the model which was followed in the case of Delhi and has proven successful.
    • Commercial losses have come down from 50% to single-digit figures within a span of 10 to 12 years.
    • Once we reach that stage, we can think of creating a full-fledged retail market where a consumer can choose her supplier.

    Consider the question “Despite several reforms in the power sector, India still lacks full-fledged retail. What are the challenges in the creation of such a market. Suggest the ways to deal with the challenges.”

    Conclusion

    The Indian consumer is only interested in good quality power supply at a reasonable price. We only need to take policy measures so that the incumbent utilities can provide this, since, this will be the least costly path.

    Source:-

    https://www.financialexpress.com/opinion/power-reforms-uk-lessons-for-india/2127560/

  • What is NAFED?

    The central cooperative NAFED will soon begin importing onions in a bid to tame soaring prices before the festive season.

    UPSC can frame statements based MCQ over the functions of NAFED.

    NAFED

    • National Agricultural Cooperative Marketing Federation of India Ltd (NAFED) is an apex organization of marketing cooperatives for agricultural produce in India.
    • It was founded on 2 October 1958 to promote the trade of agricultural produce and forest resources across the nation.
    • It is registered under the Multi-State Co-operative Societies Act.
    • NAFED is now one of the largest procurement as well as marketing agencies for agricultural products in India.
    • With its headquarters in New Delhi, NAFED has four regional offices at Delhi, Mumbai, Chennai and Kolkata, apart from 28 zonal offices in capitals of states and important cities.

    Functions of the NAFED

    • To facilitate, coordinate and promote the marketing and trading activities of the cooperative institutions, partners and associates in agricultural, other commodities, articles and goods
    • To undertake purchase, sale and supply of agricultural, marketing and processing requisites, such as manure, seeds, fertilizer, agricultural implements and machinery etc.
    • To act as a warehouseman under the Warehousing Act and own and construct its own godowns and cold storages
    • To act as agent of any Government agency or cooperative institution, for the purchase, sale, storage and distribution of agricultural, horticultural, forest and animal husbandry produce, wool, agricultural requisites and other consumer goods
    • To act as an insurance agent and to undertake all such work which is incidental to the same
    • To collaborate with any international agency or a foreign body for the development of cooperative marketing, processing and other activities for mutual advantage in India or abroad

    Now try this PYQ:

    Q.In, India, markets in agricultural products are regulated under the:

    (a) Essential Commodities Act, 1955

    (b) Agricultural Produce Market Committee Act enacted by States.

    (c) Agricultural Produce (Grading and Marking) Act, 1937

    (d) Food Products Order, 1956 and Meat and Food Products Order, 1973

  • Allaying the fears of farmers over MSP regime

    Question of MSP regime while arguing in favour of recently passed agri bills has made the farmers apprehensive of the purpose of the bill. The article argues for allaying the fears of the farmers and explains the salience of the MSP.

    Flawed argument over MSP

    • The recently enacted farm bills have triggered debate on the desirability of the MSP regime.
    • But, the bills do not facilitate a policy to do away with Minimum Support Prices (MSPs).
    • The bills allow free entry to agents who wish to set up markets — whether they be private individuals, producer collectives or cooperatives.
    • This means that the Food Corporation of India (FCI) and other associated agencies can procure in the traditional mandis, or in a new market established under this law — or in their own backyard.
    • So, the argument that if the mandis cease to exist, the procurement will also cease is, in fact, flawed.
    • Supporters of the bills have quoted the Shanta Kumar committee’s figures to argue that MSPs are anyway irrelevant for most of the farmers in the country.
    • This linkage of the farm bills with the MSP only adds to the apprehension that farmers have about the bills.

    Significance of MSP

    • It is true that the procurement has remained confined to only a few crops.
    • But the benefits to the farmers even beyond Punjab and Haryana are certainly not negligible.
    • It is true that only a small fraction benefits directly from the procurement.
    • But one cannot ignore the indirect benefit of this to all foodgrain producers in the country.
    • As the procurement significantly exceeds the PDS requirement, this creates additional demand in the foodgrain market, pushing up the prices.
    • This has been a great help for all the grain producers in the country, especially when the international prices have remained low for a long time now.
    • The RBI’s annual report of 2017-18 on impact of MSP on the food prices conclusively shows that MSP is a leading factor influencing the output prices of the farm produce in the entire country.
    • The issue of MSP is all the more important for rain-fed agriculturists, being deprived of irrigation, they don’t derive benefit from subsidies on electricity and fertiliser as their use is limited.
    • So, at the moment, the only state support these farmers (primarily cotton and pulse producers) have is that of MSPs.

    Conclusion

    The debate on whom and how the state should support is an issue that should be addressed independently of the farm acts. Presenting these acts as an alternative to MSPs will not persuade farmers.

  • Give reforms a chance

    Agri-bill passed by the Parliament resulted in the protest from farmers from several states. The bills have also been challenged on the legal footing as well. This article explains how the bills will benefit the farmers and also examines the legal basis used for their passage.

    States trying to nullify the agri bills passed by Parliament

    • Parliament has passed three bills on agriculture reform. This has evoked protests, largely in Punjab and Haryana.
    • Taking recourse to Article 254 of the Constitution, the Punjab government has passed its own bills to nullify some provisions of the central acts.
    • Similar action by the Chhattisgarh and Rajasthan governments seems to be on the anvil.

    Legal justification for Parliament passing the laws related to agriculture

    • The Constitution has placed agriculture on the state list.
    • Various petitions have also been filed in the Supreme Court claiming that the central laws infringe upon the jurisdiction of state governments.
    • However, it is the Centre which decides and announces support prices for major crops for the entire country.
    • It also decides issues such as bank loan waivers.
    • International agreements and multilateral trade in agricultural products also fall in the Union government’s domain.
    • Agricultural and dairy products, in fact, had a prominent role in India not joining the Regional Comprehensive Economic Partnership (RCEP).
    • Entry 33 in the concurrent list limits the power of states in agriculture, by empowering both governments to legislate on production, trade and supply of a range of agricultural foodstuffs and raw material.

    Use of Article 254 to bypass Central law

    • The Punjab bill has set in motion the process of states taking refuge under Article 254 to pass their own pieces of legislation.
    • All state bills that seek to nullify central acts have to be approved by the President after they have received the consent of the governor of the state.

    Way forward

    • Reformist chief ministers and astute policy planners should grab this opportunity and encourage investment in private infrastructure to create supply chains and give the farmer the benefit of demand-led prices.
    • They should also take appropriate action to create institutional mechanisms, such as farmer producer organisations or aggregators, to ensure greater farmer participation.

    Conclusion

    It would be in the interests of the farming community and state governments to give the much-delayed reform measures a fair chance by giving them access to competitive purchases, affording better prices.

  • Reform land ceiling laws

    Land ceiling laws, enacted to deal with the problems of a bygone era, remains unchanged even in most of the States. This has given rise to different problems. The article suggests the relaxation of the ceiling acts to deal with the problem of land degradation and water depletion.

    Background of the ceiling laws

    •  India implemented land ceiling laws to deal with the ‘zamindars’ and impose landowning limits based on total production value of land—irrigated, grove, orchard, dry, etc.
    • Landholdings were scrutinised at individual and family level, and large farms were discouraged.
    • For most states, the ceiling ratio of dry-to-irrigated land is 3:1.

    Issues with the ceiling laws

    • In 2020, State land laws remain unchanged, trapping farm families in a negative ownership trap.
    • As with each generation, the average landholding of individuals reduces.
    • Dropping farm incomes, higher inputs costs, low sale price, soil degradation and water depletion erode production and farm value.
    • A progressive farmer hits production saturation due to limited land.
    • Contract farming has been no consolation either.
    • The result is that the Indian farm size is very small, 86% under two hectares, and is decreasing as the average size of operational holding has declined to 1.08 hectares in 2015-16 versus 1.15 in 2010-11 (Agricultural Census 2015-16).
    • The government is reticent on the Economic Survey’s recommendations to increase land ceiling limits.
    • Recently, Karnataka rescinded land limit reforms.

    How to deal with soil degradation and water depletion

    • 30% of India’s land is degraded, bad agri-practices threaten soil health, and water-guzzling crops like paddy, sugarcane, etc, have resulted in a water crisis in many places.
    • States must study soil conservation program of the US, which paid farmers subsidies for soil conservation or allowing land to be fallow.
    • States should incentivise farmers for agro-ecological plantations and agro-forestry by relaxing land ceiling limits for them.
    • State Acts may include organic plantations under exempt categories similar to tea/rubber plantations.
    • Native biodiversity based mixed orchards, from mahua to moringa, can be encouraged and exempted by state governments.
    • Policy change will have benefits—soil and water rejuvenation, increase in farmers’ incomes and new products for the free market.
    • The return of organic matter and biodiversity will sustain farmland productivity.
    • Plus APEDA predicts a $50 billion organic export 2030, but the cherry would be additional carbon credits.
    • If 10% of arable land converts to organic grove land, India will mitigate climate change and pollution.
    • Each hectare with 0.01% humus can store 80,000 litres of water. We need a central policy to bolster this drive.
    • Farmers may take over waste or degraded land, beyond land ceiling limits, and restore land as a carbon sink and produce more nutrition per acre.
    • As farmers will care for these lands, the government’s financial burden to restore wastelands will lessen.

    Consider the question “Land degradation threatens India’s future if not dealt with in time. In light of this, examine the reasons for soil degradation and suggest the ways to deal with it” 

    Conclusion

    As a nation, we have a choice to steer the bigger farms towards agro-ecology or allow industrial farms to take over rural India. The government needs to bring out a fourth Ordinance to free the land for healing the Earth.

    Source:-

    https://www.financialexpress.com/opinion/reform-land-ceiling-laws-incentivise-farmers-for-agro-ecological-plantations-and-agro-forestry/2113635/

     

     

  • Politics and economics of farm bills

    Reforms in agriculture have been overdue. But the passage of farm bills by the Parliament has evoked opposition from several stakeholders. However, the passage of bills by the Punjab Assembly is the first from any State Assembly. The article explains how politics dominates agriculture reforms and its implications for economic growth.

    States trying the negate the farm bill passed by Parliament

    • By passing its farm bills, Punjab has become the first state to legislate to negate impact of legislation enacted by Parliament last month.
    • Other states like Rajasthan and Chhattisgarh, could follow suit soon.
    • Notwithstanding whether President Ram Nath Kovind gives his assent to the state bills that undermine the central ones, the important issue is to determine how much of this conflict is about economics aimed at helping farmers and how much sheer politics.

    Issues with Punjab’s farm bills

    • Punjab’s farm bills prohibit private players from buying wheat and paddy below the MSP even outside the APMC markets.
    • It doesn’t apply to other crops, say maize, cotton, pulses and oilseeds that are under the ambit of the central MSP system.
    • The point is that this pertains only to wheat and paddy.
    • The bill could even have been extended to milk and vegetables by declaring local MSPs for them, but it didn’t do that.
    • Because the state government knows full well that it will create a fiasco in agri-markets, which might boomerang on it politically.
    • Law for wheat and paddy will not help farmers as the Centre already buys more than 95 per cent of Punjab’s wheat and paddy at MSP through the Food Corporation of India (FCI) and state procurement agencies.

    Economic roots of politics over MSP: Lessons from the past

    • Demand that MSP be made a legal instrument (rather than indicative) actually exhibit deep distrust of the private sector and markets.
    • In1972 government announced that the wholesale trade in wheat and rice (paddy) will be taken over by the government as traders were being unscrupulous in not giving farmers their due MSP and manipulating prices.
    • The first marketing season of the government takeover of wholesale wheat trade, in 1973-74, saw a major fiasco.
    • Market arrivals dropped, and wheat prices shot up by more than 50 per cent. It was a bitter lesson.

    Long overdue reforms in agriculture

    • Economic reforms in 1991 took some time to yield results, but, by the 2000s, India was taking 7 per cent.
    • But even the 1991 economic reforms bypassed agriculture marketing reforms.
    • It was only in 2003, a model act on agri-marketing was circulated to the states.
    • But that model act did not go far enough.
    • From 2004 to 2014 government did not pursue any major agri-marketing reforms.
    • In food government enacted the National Food Security Act in 2013, giving 5 kg wheat or rice to 67 per cent of the population at Rs 2/kg and Rs 3/kg.
    • A high-level committee (HLC) under Shanta Kumar was formed in 2014 to restructure the grain management system.
    • The committee suggested major changes, including cash transfers in the public distribution system, and overhauling the FCI’s operations and free markets to make the system more efficient.
    • But the government could not undertake bold reforms, except some marginal tinkering of labour rules in the FCI.

    Conclusion

    The COVID-19 crisis opened a window of opportunity to reform the agri-marketing system. The government grabbed it — this is somewhat akin to the crisis of 1991 leading to de-licensing of industry. Patience and professionalism will bring rich rewards in due course, not noisy politics.

  • Promotion of nutri-cereals(Millet crop) in India

    Promotion of millet crops serves the dual purpose of securing health and supporting farmers. This article explains the strategy adopted by the government to achieve the same.

    Millet crops in India

    • The three major millet crops currently growing in India are jowar (sorghum), bajra (pearl millet) and ragi (finger millet).
    • India also grows a rich array of bio-genetically diverse and indigenous varieties of “small millets” like kodo, kutki, chenna and sanwa.
    • Major producers include Rajasthan, Andhra Pradesh, Telangana, Karnataka, Tamil Nadu, Maharashtra, Gujarat and Haryana.

    Advantages of millet cultivation

    • Millets are good for the soil, have shorter cultivation cycles and require less cost-intensive cultivation.
    • These unique features make millets suited for and resilient to India’s varied agro-climatic conditions.
    • Millets are not water or input-intensive, making them a sustainable strategy for addressing climate change and building resilient agri-food systems.

    Reasons for decline in millet production in India

    • In the 1960s before the Green Revolution, millets were extensively grown and consumed in India.
    • With the Green Revolution, the focus, rightly so, shifted to food security and high-yielding varieties of wheat and rice.
    • An unintended consequence of this policy was the gradual decline in the production of millets.
    • Millets were increasingly seen as “poor person’s food”.
    • The cost incentives provided via MSPs also favoured a handful of staple grains.

    Health issues related to refined food

    • Along with declining millet production, India saw a jump in consumer demand for ultra-processed and ready-to-eat products, which are high in sodium, sugar, trans-fats and even some carcinogens.
    • This demand was again met by highly-refined grains.
    • With the intense marketing of processed foods, even the rural population started perceiving mill-processed rice and wheat as more aspirational.
    • This has lead us to the double burden of mothers and children suffering from micronutrient deficiencies and the astounding prevalence of diabetes and obesity.

    Strategy for promotion of nutri-cereals

    1) Rebranding the cereals as nutri-cereals

    • The first strategy from a consumption and trade point of view was to re-brand coarse cereals/millets as nutri-cereals.
    • As of 2018-19, millet production had been extended to over 112 districts across 14 states.

    2) Incentive through hiking MSP

    • Second, the government hiked the MSP of nutri-cereals, which came as a big price incentive for farmers.
    • From 2014-15 to 2020 MSPs for ragi has jumped by 113 per cent, by 72 per cent for bajra and by 71 per cent for jowar.
    • MSPs have been calculated so that the farmer is ensured at least a 50 per cent return on their cost of production.

    3) Providing steady markets through inclusion in PDS

    • To provide a steady market for the produce, the Modi government included millets in the public distribution system.

    4) Increasing area, production and yield

    • The Ministry of Agriculture & Farmers’ Welfare is running a Rs 600-crore scheme to increase the area, production and yield of nutri-cereals.
    • With a goal to match the cultivation of nutri-cereals with local topography and natural resources, the government is encouraging farmers to align their local cropping patterns to India’s diverse 127 agro-climatic zones.
    • Provision of seed kits and inputs to farmers, building value chains through Farmer Producer Organisations and supporting the marketability of nutri-cereals are some of the key interventions that have been put in place.

    5) Intersection of agriculture and nutrition

    • The Ministry of Women and Child Development has been working at the intersection of agriculture and nutrition by -1) setting up nutri-gardens, 2) promoting research on the interlinkages between crop diversity and dietary diversity 3) running a behaviour change campaign to generate consumer demand for nutri-cereals.

    Consider the question “What are the reasons for decline in the millet production in India? What are the steps taken by the government to encourage its production?”

    Conclusion

    As the government sets to achieve its agenda of a malnutrition-free India and doubling of farmers’ incomes, the promotion of the production and consumption of nutri-cereals seems to be a policy shift in the right direction.

  • [pib] Market Intervention Scheme

    The Union Cabinet has approved the extension of Market Intervention Scheme (MIS) for apple procurement in Jammu and Kashmir (J&K) for the current season.

    UPSC can ask a question on the difference between MSP and MIP. All the agricultural and horticultural commodities for which Minimum Support Price (MSP) are not fixed and are generally perishable in nature are covered under Market Intervention Scheme (MIS).

    Market Intervention Scheme

    • MIS is a price support mechanism implemented on the request of State Governments for the procurement of perishable and horticultural commodities in the event of a fall in market prices.
    • It is implemented when there is at least a 10% increase in production or a 10% decrease in the ruling rates over the previous normal year.
    • MIS works in a similar fashion to Minimum Support Price based procurement mechanism for food grains but is an ad-hoc mechanism.
    • Its objective is to protect the growers of these horticultural/agricultural commodities from making distress sale in the event of the bumper crop.
    • Under MIS, support can be provided in some years, for a limited but defined period, in specified critical markets and by purchasing specified quantities. The initiative has to emerge from the concerned state.

    Commodities covered

    • The MIS has been implemented in case of commodities like apples, garlic, oranges, grapes, mushrooms, clove, black pepper, pineapple, ginger, red chillies, coriander seed, chicory, onions, potatoes, cabbage, mustard seed, castor seed, copra, palm oil etc.

    Remuneration under MIS

    • MIS provides remunerative prices to the farmers in case of the glut in production and fall in prices.
    • Proposal of MIS is approved on the specific request of State/UT Government, if they are ready to bear 50% loss (25% in case of North-Eastern States), if any, incurred on its implementation.
    • Further, the extent of total amount of loss shared is restricted to 25% of the total procurement value which includes the cost of the commodity procured plus permitted overhead expenses.

    Implementation of MIS

    1) Market Intervention Price (MIP)

    • The Department of Agriculture & Cooperation is implementing the scheme.
    • Under the MIS, a pre-determined quantity at a fixed MIP is procured by NAFED as the Central agency.
    • There are other agencies designated by the state government for a fixed period or till the prices are stabilized above the MIP whichever is earlier.
    • The area of operation is restricted to the concerned state only.

    2) Funds transfer

    • Under MIS, funds are not allocated to the States.
    • Instead, central share of losses as per the guidelines of MIS is released to the State Governments/UTs, for which MIS has been approved, based on specific proposals received from them.

  • [pib] Asafoetida (Heeng) cultivation in Himalayan Region

    Farmers of the remote Lahaul valley in Himachal Pradesh are taking up cultivation of asafoetida (Heeng) to utilize vast expanses of waste land in the cold desert conditions of the region.

    Try this PYQ:
    Q.Which one of the following reflects back more sunlight as compared to other three?
    (a) Sand desert
    (b) Paddy crop land
    (c) Land covered with fresh snow
    (d) Prairie land

    Asafoetida cultivation in India

    • Asafoetida is one of the top condiments and is a high-value spice crop in India.
    • Raw asafoetida is extracted from the fleshy roots of Ferula assafoetida as an oleo-gum resin.
    • Although, there are about 130 species of Ferula found in the world, but only Ferula asafoetidais the economically important species used for the production of asafoetida.

    Why cultivate it?

    • Heeng is not cultivated in India.
    • Government data states that India imports about 1,200 tonnes of raw heeng worth Rs 600 crore from Iran, Afghanistan and Uzbekistan.

    Regions for its cultivation

    • Asafoetida best grows in dry and cold conditions.
    • The plant can withstand a maximum temperature between 35 and 40 degree, whereas during winters, it can survive in temperatures up to minus 4 degree.
    • During extreme weather, the plant can get dormant.
    • Regions with sandy soil, very little moisture and annual rainfall of not more than 200mm are considered conducive for heeng cultivation in India.

  • Farm Bills latest step in sequential freeing up of farm sector

    The recently passed agri bills seek to expand the choices and opportunities available with the farmers and will help in increasing their income.

    Diversified product segment

    • The Minimum Support Price (MSP) evolved as a mechanism to guard farmers against supply and demand shocks in the cereals segment. 
    •  Now, however, farmers and agricultural producers have diversified their product segments, cereals no longer dominate production.
    • In the last decade itself, India has witnessed tremendous change in the GVA composition of the agri-sector.
    • The share of crops has decreased from 65.4% in 2011-12 to 55.3% in 2018-19, projected to further fall to 45.6% in 2024-25.
    •  In the same period, value add of livestock and fishing & aquaculture is steadily increasing, as are the total value outputs of sub-segments like horticulture, milk and meat.
    • With differentiated production strategies that are less reliant on cereals and more on other segments, farmers are accruing better incomes.
    • By diversifying their produce, they are moving away from one-crop risks.

    Government schemes and policies

    • Keeping farmers dependent on subsidies and restricted by APMCs, and acts like the Essential Commodities Act wasn’t in the nation’s long-term interests.
    • Recognising this, the government has been making sequential changes in the system.
    • It started with the introduction of the National Agriculture Market (e-NAM) to facilitate online trading of agri-produce.
    • Then PM-KISAN was introduced to provide minimum income support to nine crore marginal farmers, at Rs 6,000 annually.
    • The KISAN credit card with an allotment of a total of Rs 2 lakh crore credit to maintain larger workforces and implements during harvest season is helping farmers plan and organise their harvests better.
    • The Rs 1 lakh crore Agri Infrastructure Fund as part of Atmanirbhar Bharat Abhiyan will help by the creation of agri-infrastructure.

    Need for structural changes

    • The government recently passed three agri-bills, these are:-
    • 1) The Farmers’ Produce Trade and Commerce Bill.
    • 2) Farmers Agreement on Price Assurance and Farm Services Bill.
    • 3) Essential Commodities (Amendment) Bill.
    • They enable farmers the freedom to diversify their crops and produce, which reduces mono-crop dependence and increases income avenues.
    • They can also now sell their produce anywhere, to the highest bidder across the country.
    • The farmers are no longer are they required to go to the mandis where they are subject to middlemen and layers of bureaucracy.
    • Contract farming enable farmers them to boost the value-add of their products via contracts and assured procurement by the food processing industries.
    • Retaining the MSP system means the government is underwriting the whole network for certain crops to ensure farmers receive assured income for those crops.

    Focusing on the export market

    • The passage of agri bills gives India the long-awaited opportunity to orient its agriculture sector towards export markets.
    • By catering to just the Indian economy, the exposure is hardly $3 trillion ; instead, export-orientation caters to an $82 trillion global economy —a 27x expansion.
    • India’s agri exports in 2018 were at $38.5 billion.
    • India can comfortably triple this by providing infrastructure for grading, sorting, and supply chain distribution.

    Conclusion

    The farm Bills are liberating farmers at a pivotal juncture, the nation and farmers have a generational opportunity here to break out of a 70-year sectoral stagnation and aim bigger.

    Source:-

    https://www.financialexpress.com/opinion/agri-reforms-farm-bills-latest-step-in-sequential-freeing-up-of-farm-sector/2107611/