State Govt Documents Belie Nitish Kumar's Claim on Grain Procurement in Bihar

In a letter to the Centre, Bihar's agriculture secretary said that farmers were forced to sell their produce at low prices due to lack of go-downs and procurement facilities.

New Delhi: Even as protests by farmers continue unabated against the three agriculture laws enacted by the Narendra Modi government, Bihar chief minister Nitish Kumar has spoken in favour of the Centre’s move claiming that the new laws are being implemented across the country in line with the Bihar government’s decision to abolish the Agricultural Produce Marketing Committees (APMC) Act in 2006, which had benefited a large number of farmers.

“Such a system has been in place in Bihar since 2006 benefitting the farmers,” he claimed. “This system will now come into force across the country. Farmers in Bihar are not facing any problem with this system and food grain procurement is going on. This year, the government has set a target of purchasing more than 3 million tonnes of paddy.”

Commenting on the ongoing farmers’ protest, Nitish Kumar also said that the new farm laws will not create any difficulty for farmers in crop procurement and that the protests were taking place because of misconceptions amongst farmers.

However, official documents obtained by The Wire reveal that Bihar’s Ministry of Agriculture had written to the Central government stating that they had neither sufficient godowns nor proper procurement arrangements, due to which farmers were compelled to sell their produce at throwaway prices.

Before the Centre announced the minimum support price (MSP) for crops of Kharif season 2020-21, the state agriculture secretary N. Saravana Kumar wrote in his letter dated May 22, 2020, “Keeping in mind the cost of cultivation in the state, the state government had proposed the minimum support price of Rs 2,532 per quintal for paddy and Rs 2,526 per quintal for maize.”

However, the Centre has fixed the MSP of paddy at Rs 1,868 and that of maize at Rs 1,850 per quintal, which is much lower than the prices recommended by the Bihar government.

Also read: Did You Think the New Laws Were Only About the Farmers?

In the letter addressed to Srabani Guha, advisor to the Ministry of Agriculture and Farmers’ Welfare, Kumar wrote, “Bihar is one of the important maize producing states and paddy is the main kharif crop of the state. But the farmers sell their produce at low price and do not get proper profit due to non-availability of marketing infrastructure, go-downs and procurement facilities.”

This is probably the first time that the Bihar government has admitted that their procurement system is not appropriate, due to which farmers have to sell their produce at throwaway prices.

A farmer weeding a maize field in Bihar. Credit: CIMMYT/Flickr CC BY-NC-SA 2.0

A farmer weeding a maize field in Bihar. Photo: CIMMYT/Flickr CC BY-NC-SA 2.0

It is also contrary to the claim made by the Cooperative Department of Bihar in response to a report on wheat procurement in the state, published by The Wire in September.

The department had said that a network of vyaparmandals and Primary Agricultural Co-operative Societies (PACS) has been laid at the appropriate level in the state, which was undertaking record procurement. The Wire, however, had reported that despite the government’s claims of empowering farmers, less than 1% of the wheat produced in the state was procured by the Central and state government agencies in the rabi marketing season of 2020-21.

Meanwhile, a major portion of land area in ​​Bihar remains affected by floods for long periods due to which the cost of cultivation rises while production decreases.

Citing this, the Bihar agriculture secretary sought an increase in the MSP of wheat and paddy as he wrote in his letter, “Agriculture production system in Bihar is largely based on human labour, erratic and non-homogenous nature of South-west monsoon, recurrence of frequent flood in Northern Bihar, prolonged rain-fed condition in southern Bihar, larger proportion of small and marginal farmers, lower rate of adoption of new technology by farmers and their poor socio-economic conditions. These factors are largely responsible for low production of crops resulting into high cost of per unit production.”

However, the Centre rejected this proposal of the Bihar government.

Bihar Agriculture Ministry … by The Wire

In 2006, the BJP-JD(U) government of Bihar led by Nitish Kumar had abolished the APMC Act in the state, claiming that it would attract a large number of private buyers in the state, and that the farmers would have a lot of options in the market which will enable them to get fair prices for their produce.

However, farmers have suffered losses ever since the abolition of the law as traders buy agricultural produce at prices much lower than the MSP and sell the same in Punjab and Haryana at support prices.

Also read: Farmers Denied Rs 1,900 Crore Due to Sales Below MSP in Last Two Months

In Punjab and Haryana, the network of APMC mandis has been laid quite effectively for the benefit of a large number of farmers.

There have been several reports regarding the ongoing paddy procurement in Bihar, which have highlighted the plight of farmers who are forced to sell their produce at prices lower than the MSP owing to the mismanagement of the procurement system.

The Wire has also reported that several farmers have rejected Nitish Kumar’s claim and, in the absence of procurement from government agencies, are selling paddy at prices lower than the MSP. Farmers have alleged that procurement does not take place on time in the state. If at all the crop is procured, it takes several months to receive the payment.

In September, the Centre passed the Agricultural Produce Trade and Commerce (Promotion and Facilitation) Act, 2020, along the lines of the Bihar government’s move, amid widespread opposition, both inside and outside the parliament. The Act provides for the creation of a procurement system parallel to the APMC markets.

In other words, the new law bypasses the already established APMC market system and allows farmers to sell their their produce anywhere outside the markets. It also states that there will be no tax on buying or selling outside, while tax will continue to be imposed in APMC mandis.

Food security

A labourer sifts wheat crop in a field. Photo: Reuters

Farmers and agricultural organisations, however, claim that the major concern about this provision is that traders will start purchasing agricultural products outside the mandis as they will not have to pay tax. As a result, the mandis will gradually be eliminated. With the elimination of agricultural markets, the MSP will automatically become irrelevant.

The status of paddy procurement in Bihar

The Food and Consumer Protection Department of Bihar had approved the purchase of paddy on MSP in the state from November 23, 2020. This year, the government has set a target of buying at least 3 million tonnes of paddy.

However, according to the data available on the website of the state cooperative department, only 18297.15 tonnes had been procured till the morning of December 7. Of this, very little procurement has been carried out in many districts of the state. Procurement of paddy in Jamui, Lakhisarai, Sheikhpura district has not started yet.

Meanwhile, only 17.20 tonnes have been purchased in Arwal district, 33.60 tonnes in Banka, 91.10 tonnes in Gopalganj, 98 tonnes in Katihar, 93.80 tonnes in Kishanganj, 26.40 tonnes in Saran, 22.70 tonnes in Seohar, 88.10 tonnes in Sitamarhi, and 84.30 tonnes in West Champaran.

Also read: Farmers’ Stir: Nitish’s Decision to End APMC Act Has Come Back to Bite Him

According to the data of the Cooperative Department, 5731.60 tonnes have been procured so far in Bihar in Kaimur district, 2267.40 tonnes in Rohtas and 1076.90 tonnes in Saharsa.

According to the department, after more than two weeks, only 2,273 farmers have been procured, while till December 7, 134,120 farmers have registered online for procurement of paddy, of which 31,752 farmers are yet to be verified. So far, 5,004 committees have been selected in the state for paddy procurement.

In the previous procurement season, 16,778 farmers had registered for the sale of wheat. However, the government was successful in procuring wheat from only 1,002 farmers in Bihar.

Protesting against the three farm laws, the farmers have been staging sit-in protests on various borders of Delhi since November 26. There have been six rounds of talks between the Centre and the farmers regarding the issue, but so far no effective conclusion has been reached.

On December 8, a nationwide bandh was called against agricultural laws, supported by many opposition parties and organizations.

Translated from the Hindi original by Naushin Rehman.