3 THE POLITICAL ECONOMY OF BIG-FARMER PROTESTS

There is merit in the criticism that the prevailing APMC model perpetuates some form of rent-seeking behaviour, both public and private, especially in the so-called green revolution areas. APMCs levy commission on the produce which is sold on their premises. This is a source of income for both governments and licensed traders. States such as Punjab and Haryana charge a higher commission than others. For example, the Shanta Kumar committee on restructuring the Food Corporation of India noted that Punjab and Haryana were charging a commission of 14.5% and 11.5% on wheat while this was just 3.6% in Rajasthan. This commission is a valuable source of revenue for these governments. The local elite, which have diversified interests in both farming and trading also benefit from the process. Any move to suddenly do away with these benefits, irrespective of its merits or demerits, is bound to trigger a political backlash. The resignation of Harsimrat Kaur Badal of the Shiromani Akali Dal (SAD) from the union cabinet is a case in point. According to the CSDS-Lokniti National Election Study, in the 2014 Lok Sabha elections, the SAD-BJP alliance had a lead of 25 percentage points over the Congress among Jat-Sikhs in Punjab. The SAD-BJP had the biggest support among this community, which represents the landed elite in Punjab, and which has also been the traditional supporter of SAD’s politics. By 2019, this massive lead had turned into a four percentage point deficit vis-a-vis the Congress. Also, in the 2019 elections, the SAD-BJP alliance polled the most votes among Hindu upper castes, who are more of an urban demography in the state. With the Congress government in Punjab attacking these reforms, the SAD clearly fears losing its support among its traditional loyalists, the Jat Sikhs.