UP contract farming policy faces heat

Updated on Aug 23, 2007 04:23 AM IST

Though Mayawati says that farmers will have freedom to opt for or reject the new policy, the Oppn is not convinced. HT reports.

HT Image
HT Image
Hindustan Times | ByRajesh Kumar Singh, Manish Chandra Pandey & Santosh Chaudhury, Lucknow

A new agriculture development and investment policy of the BSP government on contract farming has landed it in trouble.

Though Chief Minister Mayawati has explained that farmers will have the freedom to opt for or reject the new policy, the Opposition is not convinced.

Announcing the policy on August 3, the Mayawati government said it was only a voluntary alternative arrangement meant to benefit farmers.

“Neither would the mandi parishad’s markets be closed down nor would there be any change in the present government marketing system,” the chief minister had said. Under the new policy the farmers under an alternative system would get seeds, fertilisers and other farm inputs from the investors.

The new policy explicitly allows corporates with a net worth of more than Rs 500 crore to enter into contracts and buy produce directly from farmers without going through the existing mandis. The price paid will have to be more than the government’s minimum support price for the product.

Cabinet Secretary Shashank Shekhar Singh said the new policy, that would open doors for private investment in the farm sector, does not require any legislation for its implementation.

However, the Samajwadi Party and the BJP started attacking the government on the issue.

“It would ruin 98 per cent farmers, farm labourers and small traders,” former chief minister and SP president Mulayam Singh Yadav told journalists. BJP leader Hirday Narain Dixit also flayed the government on the policy. Interestingly, during the SP regime, a similar policy was mooted but could not be implemented. Former Prime Minister VP Singh has also opposed the policy.

But the policy also has its supporters from the agriculture sector. RB Singh of the National Commission on Farmers said, “We feel that such a farming contract is never detrimental to farmers.”

Professor Sushil Kumar, chairman of the Agriculture Management Center (AMC) of IIM-L, said, "We have been talking about the need to implement contract farming in the state, though with proper safeguards." An official of the agriculture department said, "There is a darker side to contract farming. Private companies don't go for any long-term agreement with farmers. Often companies flout the terms stated in the contract."

But there were contrary views too. Deputy Director in Agriculture Department, Dr SS Rathore, recalled that Andhra Pradesh had introduced contract farming in the Cuppam area. The price of the crop produced in the contract farms slumped and the companies slashed the rate it was paying farmers.

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