Legislation UpdatesStatutes/Bills/Ordinances

After the announcement of the landmark decisions by the Government of India for reforms in the agricultural sector for raising the income of the farmers as part of the ‘Aatmanirbhar Bharat Abhiyan, the President of India has promulgated the following Ordinances with the aim of giving a boost to rural India for farmers engaged in agriculture and allied activities;

  1. The Farmers’ Produce Trade and Commerce (Promotion & Facilitation) Ordinance, 2020
  2. The Farmers (Empowerment and Protection) Agreement on Price Assurance and Farm Services Ordinance, 2020

The Central Government has been making comprehensive interventions to impart efficiency and effectiveness to agricultural marketing, with the aim of raising the income of the farmers. By recognizing the bottlenecks preventing the holistic development of marketing of the agriculture produce, the Government drafted and circulated the Model Agriculture Produce and Livestock Marketing (APLM) Act 2017, and also the Model Agriculture Produce and Livestock Contract Farming Act of 2018, for adoption by the states.

When the whole ecosystem of agriculture and its allied activities was tested during the COVID-19 crises, it reconfirmed the necessity for the Central Government to speed up the reform process and to come up with a national legal facilitative ecosystem to improve intra-state and interstate trade of agriculture produce. The Government of India also recognized the need for the farmer to sell agriculture produce at a place of his choice at a better price by increasing the number of prospective buyers. A facilitative framework was also considered necessary for farming agreements. Thus the two ordinances have been promulgated

The Farmers’ Produce Trade and Commerce (Promotion & Facilitation) Ordinance 2020” (Click to view the Gazette notification on the Ordinance) will provide for the creation of an ecosystem where the farmers and traders enjoy the freedom of choice relating to sale and purchase of farmers’ produce which facilitates remunerative prices through competitive alternative trading channels. It will promote efficient, transparent and barrier-free inter–State and intra-State trade and commerce of farmers’ produce outside the physical premises of markets or deemed markets notified under various State agricultural produce market legislations. Besides, the Ordinance will provide a facilitative framework for electronic trading and matters connected therewith or incidental thereto.

The Farmers (Empowerment and Protection) Agreement on Price Assurance and Farm Services Ordinance 2020” (Click to view the Gazette notification on the Ordinance) will provide for a national framework on farming agreements that protects and empowers farmers to engage with agri- business firms, processors, wholesalers, exporters or large retailers for farm services and sale of future farming produce at a mutually agreed remunerative price framework in a fair and transparent manner and for matters connected therewith or incidental thereto.

            The above two measures will enable barrier-free trade in agriculture produce, and also empower the farmers to engage with sponsors of his choice. The freedom of the farmer, which is of paramount importance, has thus been provided.

            The details of the above two above Ordinances is available on the website of the Department of Agriculture, Cooperation and Farmers Welfare at agricoop.nic.in.


Ministry of Agriculture & Farmers Welfare

Cabinet DecisionsCOVID 19Legislation Updates

One India, One Agriculture Market

The Union Cabinet chaired by Prime Minister Shri Narendra Modi met on 3rd June, 2020. Several landmark and historic decisions were taken in the meeting, which will go a long way in helping India’s farmers while also transforming the agriculture sector.

Historic Amendment to Essential Commodities Act

The Cabinet today approved historic amendment to the Essential Commodities Act. This is a visionary step towards transformation of agriculture and raising farmers’ income.

Background

While India has become surplus in most agri-commodities, farmers have been unable to get better prices due to lack of investment in cold storage, warehouses, processing and export as the entrepreneurial spirit gets dampened due to hanging sword of Essential Commodities Act. Farmers suffer huge losses when there are bumper harvests, especially of perishable commodities. With adequate processing facilities, much of this wastage can be reduced.

Benefits

With the amendment to Essential Commodities Act, commodities like cereals, pulses, oilseeds, edible oils, onion and potatoes will be removed from list of essential commodities. This will remove fears of private investors of excessive regulatory interference in their business operations.

The freedom to produce, hold, move, distribute and supply will lead to harnessing of economies of scale and attract private sector/foreign direct investment into agriculture sector. It will help drive up investment in cold storages and modernization of food supply chain.

Safeguarding interest of consumers

The Government, while liberalizing the regulatory environment, has also ensured that interests of consumers are safeguarded.  It has been provided in the Amendment, that in situations such as war, famine, extraordinary price rise and natural calamity, such agricultural foodstuff can be regulated.  However, the installed capacity of a value chain participant and the export demand of an exporter will remain exempted from such stock limit imposition so as to ensure that investments in agriculture are not discouraged.

The amendment announced will help both farmers and consumers while bringing in price stability.  It will create competitive market environment and also prevent wastage of agri-produce that happens due to lack of storage facilities.

Barrier-free trade in agriculture produce

Cabinet approved ‘The Farming Produce Trade and Commerce (Promotion and Facilitation) Ordinance, 2020’.

Background

Farmers in India today suffer from various restrictions in marketing their produce. There are restrictions for farmers in selling agri-produce outside the notified APMC market yards. The farmers are also restricted to sell the produce only to registered licensees of the State Governments.Further, Barriers exist in free flow of agriculture produce between various States owing to the prevalence of various APMC legislations enacted by the State Governments.

Benefits

The Ordinance will create an ecosystem where the farmers and traders will enjoy freedom of choice of sale and purchase of agri-produce. It will also promote barrier-free inter-state and intra-state trade and commerce outside the physical premises of markets notified under State Agricultural Produce Marketing legislations. This is a historic-step in unlocking the vastly regulated agriculture markets in the country.

It will open more choices for the farmer, reduce marketing costs for the farmers and help them in getting better prices. It will also help farmers of regions with surplus produce to get better prices and consumers of regions with shortages, lower prices. The ordinance also proposes an electronic trading in transaction platform for ensuring a seamless trade electronically.

The farmers will not be charged any cess or levy for sale of their produce under this Act. Further there will be a separate dispute resolution mechanism for the farmers.

One India, One Agriculture Market

The ordinance basically aims at creating additional trading opportunities outside the APMC market yards to help farmers get remunerative prices due to additional competition. This will supplement the existing MSP procurement system which is providing stable income to farmers.

It will certainly pave the way for creating One India, One Agriculture Market and will lay the foundation for ensuring golden harvests for our hard working farmers.

Farmers empowered to engage with processors, aggregators, wholesalers, large retailers, exporters

Cabinet approved ‘The Farmers (Empowerment and Protection) Agreement on Price Assurance and Farm Services Ordinance, 2020’.

Background

Indian Agriculture is characterized by fragmentation due to small holding sizes and has certain weaknesses such as weather dependence, production uncertainties and market unpredictability. This makes agriculture risky and inefficient in respect of both input & output management.

Benefits

The ordinance will empower farmers for engaging with processors, wholesalers, aggregators,wholesalers, large retailers, exporters etc., on a level playing field without any fear of exploitation. It will transfer the risk of market unpredictability from the farmer to the sponsor and also enable the farmer to access modern technology and better inputs. It will reduce cost of marketing and improve income of farmers.

This Ordinance will act as a catalyst to attract private sector investment for building supply chains for supply of Indian farm produce to global markets. Farmers will get access to technology and advice for high value agriculture and get ready market for such produce.

Farmers will engage in direct marketing thereby eliminating intermediaries resulting in full realization of price. Farmers have been provided adequate protection. Sale, lease or mortgage of farmers’ land is totally prohibited and farmers’ land is also protected against any recovery. Effective dispute resolution mechanism has been provided for with clear time lines for redressal.

Government committed to the cause of farmer welfare

A series of steps were announced as part of the Atmanirbhar Bharat Abhiyaan to provide a boost to those engaged in agriculture and allied activities. These include provision of concessional credit through Kisan Credit Cards, financing facility for agri-infra projects, Pradhan Mantri Matsya Sampada Yojana and other measures to strengthen fisheries, vaccination against Foot & Mouth Disease and Brucellosis, Herbal Cultivation promotion, boost to beekeeping, Operation Green etc.

Through PM KISAN, over 9.54 crore farmer families(as on first June 2020) have benefited and an amount of Rs. 19,515 crore has been disbursed so far during the lockdown period. An Amount of Rs. 8090 crore has been paid during lockdown period under PMFBY.

These steps are only the latest in a series of measures taken by the government, which shows its continuous commitment to championing the cause of welfare of the hardworking farmers of India.


Ministry of Agriculture & Farmers Welfare

[Press Release dt. 03-06-2020]

[Source: PIB]


Image Credits: News Indian Express

Cabinet DecisionsCOVID 19Legislation Updates

Union Cabinet has given its approval to extend repayment date upto 31.08.2020 for Standard Short-Term loans upto Rs 3 lakh advanced for agriculture and allied activities by banks, which have become due or shall become due between 1st March, 2020 and 31st August, 2020 with continued benefit of 2% Interest Subvention (IS) to Banks and 3% Prompt Repayment Incentive (PRI) to farmers.

Benefit:

Extension of repayment date upto 31.08.2020 for Standard Short-Term loans upto Rs.3 lakh for agriculture and allied activities by banks falling due between 1st March, 2020 and 31st August, 2020 with continued benefit of 2% IS to Banks and 3% PRI to farmers, shall help the farmers to repay/renew such loans upto the extended repayment date of 31.08.2020 at 4% p.a., interest without attracting any penalty and thus help them in avoiding travelling to banks for such renewal during this COVID pandemic period.

Background

Govt. is providing concessional Standard Short-Term Agri-loans to farmers through banks with 2% p.a, interest subvention to banks and 3% additional benefit on timely repayment to farmers thus providing loans upto Rs 3 lakh at 4% p.a. interest on timely repayment.

In the wake of lockdown due to ongoing Covid 19 pandemic, there have been restrictions imposed on movement of people. Many farmers are not able to travel to bank branches for payment of their short term crop loan dues. Moreover, due to restrictions on movement of people, difficulty in timely sale, receipt of payment of their produce and the necessity of adhering to social distancing norms, farmers are finding it difficult to arrange the amount to be deposited for renewal and are unable to visit the banks to deposit and draw fresh loans.


Cabinet

[Press Release dt. 01-06-2020]

COVID 19Hot Off The PressNews

Live Updates to Follow

  • Focal Point: Agriculture
  • One lakh Crore for — Strengthening Farming Infrastructure; Cold Storage, Grain Storage, etc.; Funding Agriculture Infrastructure Projects at farm-gate & aggregate points.
  • Rs 10, 000 Crore for boosting local products for Global sale;Vocal for Local with Global outreach; Formalisation of Micro Food Enterprises
  • Rs 20,000 crores for Fishermen through Pradhan Mantri Sampada Yojana
  • 100% vaccination of livestock;National Animal Disease Control Programme launched
  • Animal  Husbandry infrastructure fund — Rs, 15,000 Crores
  • Rs 4000 Crores to promote herbal cultivation in India that aims to cover 10 lakh hectare under herbal cultivation in 2 years; Corridor of medical plants to come up across banks of Ganga
  • Rs 500 Crores for Beekeeping initiatives
  • 500 crore for improving supply chain of fruits, vegetables, etc.;Govt. extends Operation Greens from Tomatoes, Onion and Potatoes to all fruits and vegetables
  • Amendment to Essential Commodities Act
  • Farmers & Farmers getting adequate choice to sell their produce at attractive price: Central Law to be introduced;
  • Law to implement agriculture marketing reforms to provide marketing choices to farmers; law will provide adequate choices to farmer to sell produce attractive price

Refer to the past two days live updates below:

Read below the reliefs offered by the Finance Minister, with the focus being MSMEs:

LIVE UPDATES [14-05-2020] 

  • Focal point: Liquidity, Labour, Law and Land.
  • 6 Major steps for MSMEs
  • Collateral free Automatic Loans upto Rs 3 lakh Crores
  • 100 % credit guarantee
  • Additional Funds for MSME revival
  • Loans to be given till October 31st
  • Rupees 20 Crore for stressed MSMEs
  • 50,000 Crore equity to be infused for viable and potential MSMEs
  • New Definition of MSMEs — Investment can be upto 1 Cr and turnover upto 5 Crore
  • Global tender to be allowed upto Rs 20 Crores
  • Other interventions for MSMEs
  • Rs 2500 crores EPF support for businesses and Workers for 3 months
  • EPF contribution reduced for Business and Workers for 3 months — Rs 6750 Crores
  • Rs 30,000 crores liquidity facility for NBFC/HCs/MFIs
  • Rs 45,000 Crores Partial Credit Guarantee Scheme 2.0 for NBFC
  • Rs 90,000 CR liquidity injection for DISCOMs
  • Relief to contractors
  • Extension of registration and completion date of real estate projects under RERA; No individual applications needed; Suo Moto be done; Registered projects expiring on or after 25th March
  • Rs 50,000 crores Liquidity through TDS/TCS reductions till March 2021
  • Tax filing due date extended to 30th November, 2020
  • Pending refunds to charitable trusts and non-corporate businesses & professions including proprietorship, partnership, LLP and Co-operatives shall be issued immediately.
  • Due date of all income tax return for FY2019-20 extended from 31st July, 2020 & 31st October, 2020 to 30th November, 2020 and Tax audit from 30th September, 2020 to 31st October, 2020.
  • Date of Assessments getting barred on 30th September, 2020 extended to 31st December, 2020 and those getting barred on 31st March, 2021 will be extended to 30th September, 2021.
  • Period of Vivad se Vishwas Scheme for making payment without additional amount will be extended to 31st December, 2020

LIVE UPDATES [15-05-2020]:

  • FOCUS: Migrant Workers, Street vendors, Small Farmer, Self Employed, Traders, etc.
  • 9 Steps will be announced.
  • 14.62 crore person-days of work generated till 13th May 2020
  • 10,000 crore actual expenditure till date
  • National Floor Wage to be introduced
  • Re-skilling of workers
  • Universal minimum wages

Reliefs

  • Free food grain supply to all migrants for next 2 months [For non-card holders: 5 kgs of wheat or rice or 1 kg of chana]; State Governments to implement, Centre to borne costs
  • One Nation One Ration card to be implemented within 3 months
  • Affordable rented accommodation for migrants; Rental Housing Scheme;Migrant Workers / Urban Poor to have Affordable Rental Housing Complexes (ARHC): Government will launch a scheme under
  • Mudra Shishu Loans: Government of India will provide Interest subvention of 2% for prompt  MUDRA– Shishu Loans payees for a period of 12 months; Relief of Rs 1500 cr to MUDRA-Shishu loanees
  • Special Credit facility for Street Vendors: Easy access to credit; Rs 5000 cr Special Credit Facility
  • Middle Income Group with upto 6 to 18 lakh income group: Credit link subsidy scheme for housing to be extended till March 2021; 2.5 lakhs middle income families to benefit during 2020-21
  • To create job opportunities for Tribals /Adivasis-Plans worth Rs 6000 crores to be approved shortly under Compensatory Afforestation Management & Planning Authority (CAMPA) Funds
  • Rs 30,000 Crore additional emergency working capital fund through NABARD
  • Kisan Credit Card: 2 lakh Crore concessional credit for farmers; 2 lakh crore Concessional credit boost to 2.5 crore farmers through KisanCreditCards; Fishermen and Animal Husbandry farmers will also be included in this drive
Case BriefsHigh Courts

Patna High Court: A Division Bench comprising of Mukesh R. Shah, CJ. and Ashutosh Kumar, J. while hearing a petition seeking mandamus against State for implementing organic farming policy, observed that efforts on the same were underway and dismissed the petition holding that the nature of petitioner’s prayers were that of a roving enquiry.

The instant public interest petition had been filed seeking a mandamus directing the respondent to encourage farmers of the State to opt for organic farming in order to save productivity of the earth and environment. Further, the petitioner also sought the details of the expenditure incurred for encouraging organic farming in the State as well as of the allocated subsidy amount for organic farming disbursed in various financial years since 2007-08.

The court noted that the averments in writ petition admitted that the State Government had taken a policy decision of encouraging farmers for undertaking organic farming, and for the aforesaid purpose, budgetary limits had been fixed and subsidies had been offered. The petitioners had not raised any allegation of siphoning of funds or embezzlement of public money. Thus, the prayers made in the writ petition were more in the nature of fishing and roving enquiry from the respondents, which is impermissible in public interest litigation.

The respondent’s submission before the court was that even though organic farming, being a labour-intensive exercise, is much more expensive owing to production cost being higher and less yield being produced per hectare; but still the State was using budgetary allocation to make the farmers aware of the advantages of using/ manufacturing vermi-compost and green manure. Setting up of gobar gas units was being encouraged by providing subsidy to the entrepreneurs for the said purpose.

Further, the State also submitted list programmes which had been initiated and the budgetary allocation as well as expenses incurred on “Organic Corridor Scheme” project launched in the year 2017-18. As a part of first phase, organic corridors had been developed in villages adjoining National/State highways running by the side of Ganga river. The process for certification of fields after elimination of chemical residue was afoot. Lastly, the State submitted that it was planning to implement the scheme at a larger scale by 2022; and the entire process of converting agricultural operations to organic method being a long drawn process, it would take a while before the results are visible.

Having regard to the detailed submissions made by the State and vague prayers in the petition, the High Court observed that the State was making efforts to achieve the objective of organic farming by 2022 and expecting results in such a short time would be chimerical. On that observation, the writ petition was dismissed. [Bihar Rajya Kishan Sabha v State of Bihar,2018 SCC OnLine Pat 1808, decided on 09-10-2018]

NewsTreaties/Conventions/International Agreements

The Union Cabinet gave its ex-post facto approval for the Memorandum of Understanding (MoU) between India and Iran for cooperation in the field of agriculture and allied sectors. The MoU was signed on 17-02-2018 during the visit of President of Iran to India. The MoU provides for cooperation in the areas of agricultural crops, agricultural extension, horticulture, machinery, post harvest technology, plant quarantine measures, credit and cooperation. It further provides for cooperation in soil conservation and water management, integrated nutrients management, seed technology and agricultural marketing. Also, livestock improvement, dairy development, animal health and other fields as mutually agreed upon fall within the scope of the MoU. Cooperation will also be effected through exchange of experts, materials and information, exchange of trainees and scientists on study visits/training programmes, facilitation of relevant conferences and workshops and any other means as may be mutually agreed upon. A Joint Working Group (JWG) will be formed to monitor the activities carried out in fulfillment of this MoU, with the meetings (of the ‘JWG’) to be alternately held in India and Iran once every 2 years. The MoU will be initially valid for 5 years and will be automatically extended for a subsequent period of 5 years unless either party notifies the other party of its intent of terminating it.

[Press Release no. 1524411, dt. 14-03-2018]

CABINET