Strange Fruit in the Fields
A new scheme to compensate farmers for their produce hasn’t gone down well
The Bhaavantar Bhugtan Yojana (BBY) or the price deficit financing scheme for agri produce, which came into force on October 16, is not proving to be the panacea for farmers it was built up to be. Under the scheme, announced in the aftermath of the police firing on farmers in western MP in June amid allegations of corruption and massive wastage of procured onion stocks, the state would not procure stocks on its own. Instead, the farmers would be paid the difference between the MSP and modal price of eight crops covered under the scheme. If the sale price was higher than the modal price, the farmer would get the difference between MSP and sale price. However, a fortnight into the scheme, the Bhaavantar price mechanism has become another quagmire.
The farmers have found the procurement process with its registrations and checks quite daunting. Traders have also been withholding cash payments and refusing to make online payments—offering post-dated cheques instead—citing government orders. There have already been agitations at several mandis across the state.
On the face of it, it seems traders had formed cartels to suppress prices, especially in the case of urad. While the MSP for urad stands at Rs 5,400 per quintal, it is being procured at Rs 2,000-2,200 per quintal. The government initially put up a brave face. “The pre-bhaavantar implementation prices are in the same range as the post-implementation prices, except for urad. We will check
OF THE 8.5 MN FARMERS IN THE STATE, ONLY 1.9 MN HAVE JOINED THE SCHEME SO FAR
procurement minutely to prevent cartelisation,” said principal secretary, agriculture, Rajesh Rajora.
Sensing a potential blow-up, especially during the crucial overlapping months of kharif harvest and rabi sowing, the government has gone out of its way to soothe tempers. Chief Minister Shivraj Singh Chouhan, on his return from the US, immediately announced a slew of measures to smoothen things out. He also announced that traders would be able to pay up to Rs 50,000 in cash to farmers and the rest through RTGS.
The traders initially cried foul (delaying payouts was always profitable) but were soon brought in line. The state is now also paying for the transportation of the produce, from farm to the market. The CM also said that modal prices for every crop would be announced monthly. The state government expects about 5.6 million tonnes of crop purchases through bhaavantar at a cost of around Rs 3,600 crore—to be split evenly by the Centre and state.
Whether all this will help is yet to be seen. The Congress, expectedly, is not unhappy with the situation. “The farmers are not excited about the scheme as is evident in the number of registrations,” says Opposition leader Ajay Singh. There are about 8.5 million farmers in MP (only 1.9 million have registered for the scheme so far) and their importance as a political group is not lost on anyone. The last thing Chouhan needs–in the run up to the assembly elections—is another farmer agitation.