Farmer’s Bill, 2020 – Boon or Bane?

Farmer’s Bill, 2020
Sanchita Choudhary
| Updated: Oct 09, 2020 | Category: Producer Company

India is considered to be a country where more than 60 percent of the population is engaged in the agricultural activity. Farmers are seen as feeding hands for the nation but it is saddening to see that these hands that feeds the nation in strangulated in starvation. Agriculture not only employs a large section of the population but also contributes in the growth of GDP by 15% of the country. In recent time, agitation and protest by the farmers can be seen at various parts of the country. These are because of the introduction of three new Farmer’s Bill, 2020 which are The Farmers Produce, Trade and Commerce (Promotion and Facilitation) Bill, 2020, The Farmers (Empowerment and Protection) Agreement of Price Assurance and Farm Bill Services, 2020 and The Essential Commodities (Amendment) Bill, 2020. The Farmer’s bill, 2020 was passed on 14th September, 2020 by the Union Minister Shri Narendra Singh Tomar in both the houses of the Parliament [1].

Overview of Farmer’s Bill, 2020

The concept of the bill is basically based on One India, One Agricultural Market”. The Farmer’s Bill, 2020 intents to regulate and create an environment where farmers and traders will enjoy their freedom of sale and purchase without any barrier. The bill aims to open the gates for the farmers to the corporate world for creating better trading opportunities which could extend beyond the APMC market yards. The government is of the opinion that the new laws related to the Farmer’s Bill, 2020 provide farmers not only with more choice but also with the completion of better prices. But the opposition does not think so and considers this to be an Anti-Farmer’s Bill.

Key Highlights of the Farmer’s Produce Trade and Commerce (Promotion and Facilitation) Bill, 2020


  • Farmers can sell their agricultural produce at a place of their choice even beyond the APMC market yards at a price better than the Mandi, thus increasing the number of potential buyers.
  • The bill enables that there will be no trade barrier for the farmers in order for carrying out their business outside the physical boundaries of markets.
  • The bill proposes an electronic trading platform for the farmers to ensure seamless trade electronically.
  • No cess or levy for the sale of agricultural produce to be paid.
  • The bill proposes a separate dispute resolution mechanism for the farmers for speedy trial thus leading to avoidance of court litigation.


  • The opposition is of the view that there will be loss of revenue to the states if the farmers agree to sell their produce beyond the APMC market. “Mandis” are supposed to bring revenue for the state government and this bill if came into effect would hamper and diminish their relevance.
  • Middle man will cease to exist as farmers will be able to sell their produce directly to the registered trader.
  • Farmers fear that the new bill will end the Minimum Support Price [2] (MSP) regime. “This new legislation has nothing to do with the MSPs, it is merely providing freedom of choice to sell and buy the produces outside the mandis”, as stated by Agriculture Minister Narendra Singh Tomar.

Key Highlights of the Farmer’s (Empowerment and Protection) Agreement of Price Assurance and Farm Services Bill, 2020


  • The bill facilitates the farmers to enter into a direct commercial agreement with the corporate producing food products, exporters, retailers etc. This would provide exposure to the global markets thus eliminating the fear of exploitation.
  • It encourages in creating a framework for contract farming between a farmer and a buyer through a contract. This could provide transparency and lucrative price framework to the farmers.
  • Agricultural produce or crops under any such agreement shall be exempted from the laws and provisions relating to the Essential Commodities Act.


  • The opposition is of a view that the corporate will have an upper hand over the farmers as they have weak negotiation skills.
  • The small farmers might be deprived of any such sponsors.
  • The bill gives independence to the corporate instead of the farmers as MSP has not been mentioned anywhere in the bill.

Key Highlights of the Essential Commodities (Amendment) Farmer’s Bill, 2020


  • The Act empowers the Central Government to consider certain commodities (such as food items, fertilizers, and petroleum products) as essential commodities.
  • The bill proposes to enable the private investment in the agricultural sector.
  • Helps both the farmers as well as the consumer to bring the price stability.
  • The bill seeks to increase the competition in the market thus providing better opportunities.
  • Removes fear of excessive regulatory interference from the minds of the private players.


  • The opposition is of the view point that the freedom to stock commodities may lead to exploitation as big companies will charge exorbitant prices.
  • The price limit set for the “extraordinary circumstances” are so high that it is likely never to be triggered.


The farmers are considered to be one of the most important pillars for growth in our country. The Central Government by passing Farmer’s Bill, 2020 in the favour of the farmers has moved in the right direction for providing them the bigger platform to get the desired amount of their agricultural products. The bill will not only accelerate the growth through the investment of private sector but will construct new agricultural infrastructure and this will provide employments. The Farmer’s Bill, 2020 has not only strengthened the economy but has freed the farmers from the clutches of selling their crops at designated places.

Also, Read: Benefits of Farmer Producer Company in India.


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