An Ambitious Pact

It was an experiment that went awry in Punjab, but that hasn8217;t stopped Haryana...

It was an experiment that went awry in Punjab, but that hasn8217;t stopped Haryana from embarking on it. The state has decided to enter the uncharted territory of contract farming, beginning with over 2,500 acres spread over 100 villages of Gurgaon and Jhajjar on the outskirts of Delhi. Contract farming aims at benefitting the farmers by ensuring that they are provided agricultural knowhow by the sponsoring firm, which is also committed to purchasing the produce at good rates.

8220;We were in no hurry as we wanted to ensure proper safeguards for protecting the interests of the farmers,8221; said Chief Minister Bhupinder Singh Hooda, after handing over the first registration certificate for the scheme to SABMiller India. 8220;I am sure it will help perk up the financial condition of the farmers,8221; said Hooda, who wants to introduce the ambitious contract farming scheme in the state in a big way.

Haryana has, however, taken lessons from Punjab while inking the amendments to the Punjab Agriculture Produce Marketing Act 2004. The state8217;s farmers had suffered much exploitation because most of the agreements had been penned in English, a language they did not know well enough to protect their own interests. And since some enterprising farmers in Haryana had signed agreements with MNCs in the same fashion, the government8217;s intervention was considered a must. 8220;There had been a certain amount of bias against farming in the system which we wanted to eliminate. The official intervention will help protect the interests of the farmers,8221; said a senior officer.

The first Contract Farming Sponsor Firm, SKOL Breweries Limited, Mumbai, is a subsidiary of SABMiller India, the Indian arm of SABMiller Plo, one of the world8217;s largest brewers. It has brewing interests or major distribution agreements in over 60 countries across six continents. The firm will grow barley in the 2,500 acres, the crop chosen in view of the agro-climatic conditions of the water-starved south Haryana. In the first go, the government had included 28 villages of Farukhnagar and 36 villages of Pataudi in Jhajjar, four in Rewari and five villages in Gurgaon.

Under the agreement, the contract farmers will be provided the highest market rates with a guaranteed minimum price of Rs 800 per quintal, which is Rs 150 per quintal higher than last year8217;s MSP of Rs 650. In its bid to guard the interests of the farmers, an agreement is signed between the producer farmers and the buying firm primarily for purchasing the commodity.

The sponsoring firm will indicate the quantity and quality of the commodity, and the rates of the intended produce will be agreed upon by both the parties at the time of sowing and will be mentioned in the agreement. The sponsoring firm will provide inputs to the farmers in the shape of certified quality seeds, techniques and technology and other related services. The farmer, in turn, will grow the better, specified quality of produce and shall have better rates for his produce, which will not be below the market rates. The company shall also submit an annual account every year. The contract farming sponsor campus will be declared the market yard for purchase of contract farming produce.

Further protecting the interests of the farmers, the sponsoring firm will deposit an amount equivalent to 15 per cent of the total price of the agricultural produce on the agreed rate as security with the Haryana State Agriculture Marketing Board and Market Committees.

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The government has also made provisions for a competent appellate authority to hear and settle any disputes between the farmers and the companies with a time limit of 30 days. Also, the Act prevents transfer of title and rights of land to the sponsor or his agent in the agreement. It takes the purchases away from the set system of regulated markets.