Farmers began protesting across the country after the regulations became law, with farmers in Punjab and Haryana in the forefront of the unrest. Protesters questioned Prime Minister Modi's plans to reform agriculture through repealing laws.

Lets Decipher Farm Protests (Part -2) 

In my earlier post, I have informed you, how the glut production of a few agricultural commodities with limited consumption in India and no exports are becoming a huge economic disaster. MSP is a political milch cow for every politician worth his salt, but, who pays the bill? We the common citizens of India. Well, for the sake of rural economy, we may support it, but does it really help the farmers?

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A diverse and large country like ours, pushing the can down the road isn’t going to pay in long term. Let us now try to understand a bit deeper.

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Why only farmers in Punjab and a section in Haryana are up in arms?

To understand why only a section of farmers is at the forefront of the protest, try to follow the money trail. Below graphic sheds light on the amount of wheat procured by state agencies in different states of India.

The graph clearly indicates 70% - 80% of procurement in Punjab-Haryana is on MSP, benefiting the farmers in these states and not of any consequence to other states. Clearly, other farmers are dismayed by the protests and are absent. Moreover, the continuation of MSP and APMC is identical to the Licence Raj regime of the 70’s where rich farmers garner the maximum profits while poor are left in the lurch.

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Now, let’s try to understand the dynamics of APMC, I am sure the term has reverberated numerous times before us in the last few days of ‘farm agitation’. First intriguing question is why APMC are so important? Why Punjab CM is fueling the fire along with his cohorts? You will get the answers in tax money trail. 

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If you look at the Economic Survey report on FCI (2014), you will decipher the true intentions of Punjab politicians. 

The report clearly indicates the juggling of numbers by Punjab and Haryana, to increase their coffers at the expense of ‘farmers’. Punjab levies maximum taxes on farm produce, due to arbitrary nature of taxes on APMCs the state benefits. On the other hand, there is not much difference between the annual income of farmers among different states. This is because lower taxes are levied by other state govt on APMCs. I believe the mischief in numbers is now clear for everyone to understand. MSP is not helping the farmers, it is the state Punjab that is making money out of MSP.

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Punjab by imposing 15% taxes on MSP given by the central government is filling its coffers, while the condition of farmers is almost the same whether he is from Punjab or Bihar. The Rs.64,000 crore net worth of wheat fetches Rs.9600 cr. In taxes to the state. This is what drives the Punjab political support to the so-called agitation. 

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Here, the state government and its ‘arhtiyas’ keep getting rich with the continuation of MSP and by imposing taxes, while farmers and FCI are at the receiving end. We the common man, pay our taxes to keep the state that acts as a middle man happy. It is now easy to understand that the farmer’s agitation serves two purposes of ‘Opposition politicians’, One bleeds Modi of political capital earned through hard-work while using farmers as fodder, keep them subdued to the old system. 

Photo and charts/graphs courtesy - Google images