Farmers Movement Archive

‘Evolve a mechanism to cap veg and fruit prices’

Col Jasjit Singh Gill (Retd) Farmers on the Delhi border are fighting for repeal of the three farm laws, including the much-discussed MSP. Even as fevered discussions take place on these issues, one subject that constantly escapes attention is the rise in prices of fruits and vegetables. The rise in prices of these commodities has a direct effect on people’s ability to feed their families. Now that the national focus is on these issues, we need to focus on the absence of a cap on profit levels of retailers. This issue has evaded the attention of almost everyone dealing with the various aspects of inflation, be they economists, policy planners or politicians. Since there is no regulatory mechanism to keep prices in check, we take inflation for granted. Most people involved in the trade of vegetables and fruits, other than wholesale traders and sub-traders, are almost invisible to financial institutions. These include pharri and rehri vendors, who are considered very poor. This is a pointer to how much money is in the hands of a few. Worst affected by the rampant profiteering are those who belong to poor and lower middle class backgrounds. The high profits have been made possible by lack of cold chain and storage facilities in mandis and distress selling by farmers who cannot take perishable vegetables back. With retail prices being fixed at whim, they are often out of the reach of poor consumers as the percentage of profit ranges between 40% and 100% . The prices are kept high artificially on one pretext or the other, such as less rain, strikes and bandh, failed transportation, hoarding by wholesale traders to create scarcity etc. There is no way a consumer can ascertain the actual cost and has to pay whatever price is demanded by the retailer. While it is agreed that MRP is not feasible, the regulator can fix prices on the lines of Maximum Selling Price or Consumer Price or Retail price. What we can still fix is the percentage of profit, which can be in the range of 5% to 25%, keeping in view the effort, man hours spent and capital put in. However, under no circumstances should it be allowed to reach 100% or more, as is happening now. Similarly, as and when minimum support/ selling price for vegetables is decided and fixed, the farmer or producer must get minimum 40% to 50% of the price depending on established quality levels. What needs to be done There has to be a mechanism by which all retailers will have to display the cost of bulk on display, which should be verifiable for a particular vegetable on the website/records of the market from which the retailer has bought or picked up the vegetable. This will provide relief to farmers trying to break the paddy-wheat cycle by adopting diversification. This will no doubt alienate a few but it will be in the larger interests of the rural and urban poor. It will also encourage farmers to get into retail on their own and get remunerative prices. (Writer is an environmentalist and a social activist)

The Times of India

2020-12-29

Chandigarh