India is to scrap agricultural reform laws that sparked a year of huge protests by farmers, Indian Prime Minister Narendra Modi said yesterday in a surprising U-turn that sparked celebrations, but also criticism from economists.
Thousands of farmers have been camped on the borders of the capital, New Delhi, since November last year, handing Modi one of the biggest challenges since his Hindu nationalist government came to power in 2014.
The rallies became a lightning rod for opposition to Modi’s administration in a country where two-thirds of its 1.3 billion population rely on agriculture for their livelihood.
Photo: AFP
In a contrite address to the nation coinciding with a major Sikh festival — the religion of many farmers — Modi said the laws would be repealed in parliament’s winter session, which begins later this month.
“I appeal to all the farmers who are part of the protest ... to now return to your home, to your loved ones, to your farms, and family. Let’s make a fresh start and move forward,” the 71-year-old said.
The announcement sparked muted celebrations with farmers chanting, waving flags and beeping tractor horns at two protest sites outside Delhi.
“Until they give it to us in writing, we won’t leave from here. We don’t trust the government,” farmer Gurmeet Singh, 50, said.
“Our farmers have died fighting for this. Until it’s passed in the parliament, we won’t leave,” he added.
The reforms passed in September last year aimed to deregulate farm produce markets where state bodies have for decades set guaranteed minimum prices for crops.
Modi yesterday reiterated that the changes would have boosted rural incomes and reformed a hugely inefficient agricultural sector where a vast amount of produce rots before it can be sold.
Thousands of Indian farmers commit suicide every year because of poverty, debt and ever more erratic weather patterns caused by climate change.
“This is a black day in the history of India’s economic reforms. This is Modi’s worst decision ever,” economist Gautam Chikermane of the Observer Research Foundation think tank said.
“Now there will be no agriculture sector reforms for the next 25 years... These three farm sector reforms would have done to India’s agriculture what the 1991 reforms did to manufacturing and services.”
Modi’s reversal came ahead of important elections for his Bharatiya Janata Party in states such as Punjab and Uttar Pradesh, both home to large numbers of farmers.
“The farm laws were dead in the water and it was always a question of Modi’s ego which stood in the way of government repealing them,” Hartosh Singh Bal, political editor of Caravan magazine, said.
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