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  • This is one of the busiest highways leading to Delhi.

  • It's been blocked for weeks.

  • Tens of thousands of farmers from the northern states of India

  • have marched to the capital city to protest farming reforms.

  • They've covered at least five major highways around the city.

  • The police met them with tear gas and water cannons.

  • But they made it through and have now set up camp in and around Delhi.

  • This is all happening because Prime Minister Modi's government

  • has passed new farming laws that will change how the agricultural industry

  • has worked for decades.

  • And in a country of 1.4 billion people, where agricultural workers make-up half of the labor force,

  • the repercussions of those laws could be devastating.

  • In the 1960s India, a recently independent country,

  • was struggling to produce enough food for its citizens.

  • A string of droughts made things worse causing devastating famines.

  • So the government stepped in to modernize farming

  • and increase the food supply

  • in what was called the "Green Revolution".

  • They brought in U.S. advisors to help boost the production of rice and wheat.

  • Together they ended up overusing chemical fertilizers, pesticides and irrigation

  • causing large plots of land to become infertile.

  • Many crops suffered. Some nearly disappeared.

  • But rice and wheat production soared.

  • And soon, India went from having a food crisis to having a food surplus.

  • It was in this context that India also developed a nationwide food marketing system to ensure fair prices.

  • It's a complex system and it differs from state to state but here's one way to understand it.

  • It starts with farmers bringing their crops here to wholesale markets locally known as "mandis."

  • The farmers then sell those crops to traders through open auctions with transparent pricing.

  • Prices can also be informed by the Minimum Support Price or MSP.

  • A government price for crops like rice, cotton, wheat...

  • The government only buys a couple of crops at these prices in certain states

  • but those prices can still serve as a benchmark.

  • The crops then go to a secondary market or are stored by the buyers

  • before they are sent out for future sales.

  • It's not a perfect system though.

  • Local traders do end up colluding with each other the auctions actually are not competitive bidding.

  • But for the most part the system works on a large scale because there's oversight that

  • aims to protect farmers by giving them market standards.

  • They've been designed keeping in mind the fact that farmers are the weakest link and

  • they can be exploited in numerous ways.

  • Over the years, state reforms have gradually redefined and regulated markets

  • in different ways across India.

  • In Punjab and Haryana, for example, they have become a vital part of the industry

  • and farmers here have the highest incomes in the country.

  • But in the state of Bihar markets were eliminated in 2006

  • and the farmers here are still the poorest in India by income.

  • And all of this is happening while there's a bigger farming crisis.

  • The money in farming is disappearing.

  • Since the days of the "Green Revolution", agriculture has gone from accounting for nearly

  • 50 percent of the economy to just 15.

  • Meaning millions of farmers already have trouble making ends meet in this shrinking economy.

  • More than half of India's farming households are in debt.

  • And this debt has contributed to a suicide crisis.

  • In the last two years, more than 20,000 farmers have died by suicide.

  • Because of this economic hardship farmers have been asking for reforms for decades.

  • But this year instead of providing more protections for this vulnerable community,

  • the central government went in the opposite direction.

  • And farmers fear that the direction in which the reforms are happening are actually a direction

  • of dismantling of the MSP.

  • So let's take a look at these three farming acts that sparked the protest.

  • Each of them deregulates a different part of the system.

  • The first act creates free unregulated trade spaces outside the markets.

  • The laws in these spaces would override wholesale market rules.

  • and although a lot of trade takes place outside already

  • what happens in the markets remains a benchmark across the industry.

  • But this act will create two parallel markets with very different rules.

  • One with oversight and another that creates room for big corporate players to come in unregulated.

  • And in this dual market structure, the players in the regulated markets are

  • bound to move out and operate in the deregulated spaces.

  • And that is where farmers are going to lose out.

  • When these traditional spaces collapse onto themselves.

  • The second act creates a framework for contract farming deals.

  • Any business agreements would be strictly between farmers and traders with little oversight,

  • giving farmers few options to fight bad deals.

  • As these agreements increase outside of wholesale markets

  • they could further fragment the market and leave small farmers

  • dependent on terms set by big corporations

  • or be cut out of the industry altogether

  • The third act affects a different part of the chain.

  • It eliminates the storage limits previously set by the government to control prices.

  • Unlimited storage means that anyone with enough money can stock up.

  • The problem is without oversight they can also start dictating prices.

  • Altogether the three acts invite big players into a fragmented and deregulated market

  • that could lead to volatile prices for farmers.

  • And by deregulating the markets the government has also put out a message in the same breath

  • essentially saying that they think farmers don't need any protection anymore from the government.

  • On June 3rd, 2020, when the government announced the farming reforms, it didn't take long

  • for the impact to be felt on the ground.

  • Wholesale markets around the country have already seen fewer crops arrive in their market yards.

  • In the state of Madhya Pradesh, more than 40 markets have lost business.

  • Trading has moved out of regulated market spaces and it is not as though good prices

  • are being fetched by farmers.

  • And this is the context in which the farmer's anger has to be understood

  • They didn't get what they wanted and what was thrust down upon them

  • is very different from what they were asking for.

This is one of the busiest highways leading to Delhi.

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