The farmers’ produce trade and commerce act" and its impact on states with and without APMC- Punjab, and Bihar

Abstract

Agriculture is an important source of livelihood for about 58 percent of country’s population. Agriculture’s share in GVA along with allied sector stands at 17.8 percent as per the latest reports (IBEF, 2021). Hence, Agri sector represents a major arena for investment in domains like irrigation, warehousing, cold storage etc. Additionally, the growing input market is facilitating usage of hybrid crops and better fertilizers and pesticides to the farmers, hence driving higher productivity and yield for farmers. However, this was not the case always. Agrarian distress was at its peak in 2018 with rising prices of agricultural inputs, crops, unavailability of water, limited access to clean energy, and lack of affordable credit system (Jha, 2018). Even after multiple efforts from the government, the situation remained far from better. Hence, to make agriculture more profitable, the government felt the need to open this sector to private players. Three ordinances were brought that were later converted into Farm Laws. Ever since there has been widespread resistance against these laws as they seem to favor large corporations. “The Farmers’ Produce Trade and Commerce (Promotion and Facilitation) Act, 2020” has remained the most controversial since it is believed that over the long run, the private sector would cartelize and control the market price, which would deprive farmers of the minimum support price. Hence, through our study, we want to establish a clearer picture and analyze if there is a significant gap between the applicability of this law from its intended purpose.