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Bihar Shows What Happens if Agri-Trade is Left to ‘Free Market’ -Subodh Varma

-Newsclick.in

In 2006, chief minister Nitish Kumar scrapped the APMC Act in Bihar and the destructive effects can be seen in the seething anger amongst farmers.

What the Narendra Modi government recently did through passing laws to deregulate agricultural trade, Bihar chief minister Nitish Kumar had accomplished 14 years ago, in 2006. Soon after becoming chief minister in alliance with Bharatiya Janata Party (BJP), he scrapped Bihar’s Agricultural Produce Marketing Committee (APMC) Act. It was declared that this would lead to increased private investment in agricultural infrastructure, better prices for farmers and an end to middlemen – all of which Prime Minister Modi is also repeating now for the new laws. But what has been Bihar’s experience?

Almost 80% of foodgrain needed by the state’s people is now brought in from other states. Farmers’ are invariably forced to sell their produce at prices much below government declared Minimum Support Prices (MSP). There is high degree of price volatility. Government procurement is shockingly low.

Wholesale markets for foodgrain and fruits and vegetables are privately run, without any required infrastructure, with farmers at the mercy of cartelised big traders. Remember, that about 91% of Bihar’s farmers are small and marginal. So these conditions are catastrophic for them. And, with the state’s economy largely dependent on agriculture, the distress of farmers perpetuates the state’s economic backwardness.

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