On November 19, Indian Prime Minister Narendra Modi in a special address to the nation on the occasion of Guru Purab had announced that the three farm laws, that thousands of farmers have been protesting for over a year on the various Delhi Borders, will be repealed. The Union Cabinet had on Wednesday approved the relevant draft bill to repeal these laws.
Now, as the Farm Laws Repeal Bill, 2021 has been listed for introduction on Monday, the first day of the winter session of the Parliament, for passage, we look at the impact of this action and how things may pan out in the future:
- The repealing of the farm laws sends a negative signal to the corporate world. India’s agriculture sector and policy lacked innovation despite the government’s support. The big corporations could have been the key to new investments in the agri-sector. For a government and a party that is proud to be business-friendly and showcases improvement in ease-of-doing-business, the repeal of the law is a retreat that might hurt on multiple fronts.
- Behind this tactical retreat, there is a political move. The repeal of the laws may not be good for political relations in Punjab for BJP. The only benefit for them is that the repeal may pave the way for an alliance with Captain Amarinder Singh’s new party.
- In a scenario where Congress is removed in Punjab, and another party backed by BJP assumes power, the ruling party may feel that the decision to repeal the laws has paid them generously.
- Farm leaders could demand to block privatisation reforms of public sector enterprises.
- Farm unions are likely to continue their demand for a constitutional guarantee on Minimum Support Price and repeal of electricity law.
- The farmers’ protest had the potential to cause serious damage to the voting share of the BJP. Moreover, it could have led to the joining of people suffering from other economic problems such as job losses, price-rise, falling incomes and deprived livelihood. Only the repeal of the laws could have prevented this damage.
- The Prime minister is now being seen as someone who bent down in front of short term political gains and came under pressure from farmer groups. The entire Modi-image had been created with a perception of him being an iron-willed leader who does not give up even in the face of political interests.
- The repeal has underlined the need for wider consultation, not only for better reforms but also for wider acceptance. Once the laws are repealed the BJP government will not be able to pursue these reforms in any way ever again.