Farm unions protest direct payment order issued by FCI

#GS2 Issues Relating to Development and Management of Social Sector/Services relating to Health, Education, Human Resources

#GS3 Agriculture

News info:

Recent orders from the Food Corporation of India (FCI) have led to a new spark in the ongoing farmers' protests, with farm unions cold warning that the Centre’s insistence on direct payment and tenancy documentation could derail the crop procurement process.

Farm unions held a protest to withdraw this order.


The unions claimed that the government should roll back the provision of direct payment to the bank account. Implementing it in haste can lead to complex problems that will exclude so many farmers from getting their price of the crop.

FCI's say on the issue:

The FCI has insisted that direct payment to farmers’ bank accounts, bypassing the powerful arhatiyas or commission agents, will lead to greater transparency and accountability.

Reason for protest:

Since arhatiyas play a key role in the Punjab and Haryana farm ecosystem by providing farm loans, the move has been opposed by a large section of farmers, as well as the Punjab government.

Furthermore in the order:

  • Another FCI order stipulates that tenant farmers and sharecroppers must produce a jamabandhi, or legal agreement proving that they have the right to till leased land, in order to get paid for procured crops. 
  • Thousands of sharecroppers do not have such agreements and will be hit hard by this move. 
  • The FCI’s fresh proposals to tighten quality requirements for wheat and paddy procurement from the next marketing season are also being opposed.
  • At a broader level, farmers connected their issues with the FCI with their existing demands to repeal the farm laws and enact a legal guarantee for the procurement of all crops and minimum support prices.


  1. The Acts will increase control of the private sector in food grains storage, cold storage, food processing, and marketing
  2. Ultimately the government plans to wind up subsidized food distribution under [the Public Distribution System] and reduce it to a cash transfer scheme under pressure from the [World Trade Organisation] and imperialist countries like the U.S.A. 
  3. It also plans to sell off the FCI warehouses to the private sector to pay off the debts,


Source: The Hindu

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