An inevitable consequence of Modi’s farm laws will be the gradual death of public distribution system (PDS). Through PDS, an estimated 75 crore people, belonging to the economically weaker sections, are provided essential commodities such as wheat, rice, sugar and kerosene through a network of about five lakh fair price shops across the country. This is, or rather was, done by the Central and State governments from the stocks they replenished periodically under the provisions of the Essential Commodities Act 1955. This Act now stands repealed.
The Act of 1955 provides that the Central government is responsible for procurement, storage and transportation of food grains and other commodities like kerosene to the State. It is the State’s duty to ensure distribution of the commodities to the eligible consumers through fair price shops. Besides, the State has the responsibility to identify the beneficiary families, issue ration cards and also to set up fair price shops and monitor their proper functioning.
The Act went beyond helping the economically weaker sections through subsidised food grains and other essential commodities. It empowered the Central government to regulate or prohibit the production, supply, distribution and trade of any commodity “for maintaining or increasing supplies of any essential commodity or for securing their equitable distribution and availability at fair prices, or for securing any essential commodity for the defence of India or the efficient conduct of military operations”.
More significantly, the government had the power to direct the grower to ‘sell the whole or a specified part of the quantity held in stock or produced or received by him’ to the ‘Central Government or a State Government or to an officer or agent of such Government or to a Corporation owned or controlled by such Government’. This helped the Central and State governments to replenish their stocks. The procurement was done by the Central government through Food Corporation of India (FCI) and by a State government through its Department of Food and Civil Supplies. As the bulk of produce was purchased by the government agencies, farmers were sure to get minimum support price (MSP) announced by the government.
Under Modi’s three farm laws, this has become part of history. Now it is between farmer and businessmen. Both the farmers and consumer are now at the mercy of businessman. If the businessmen join hands, for instance, and decide on a price for a certain produce, the farmer will become helpless. Similarly, if half a dozen big businessmen form a cartel (which Modi’s new Acts allow) and corner the entire production of wheat in MP, Rajasthan, UP, Gujarat, Haryana and Punjab, the consumers will be at their mercy as to when they bring the commodity to the market for sale, in which quantity and at what price. This has happened during the 1980 Lok Sabha elections in case of onion which was not then covered by the Act of 1955.