TIndian Prime Minister Narendra Modi announced last week that his controversial farm laws would be withdrawn. With five state elections looming and his ruling Bharatiya Janata (BJP) party vulnerable in several contests, Mr. Modi told the country how important agriculture has been to him and has done something unlike him. : he ate a humble pie in public, apologized and dropped his plans. It was the right thing to do.
Mr Modi had proposed the major changes, which threatened the livelihoods of two-thirds of India’s 1.4 billion people, when the country was locked out against Covid in 2020. The measures were drafted in secret and then flogged by the two houses of the Indian parliament without debate. Agriculture in India needs reform, but not the kind that Mr. Modi envisioned and that many farmers reasonably believed he would leave them behind. mercy of a government at the hock of large companies.
The result was widespread resentment throughout the agricultural belt of northern India and produced possibly the largest peaceful protests in the world. Mr. Modis’ government responded with cuts to water cannons and the Internet. The protesters were shamefully labeled by the BJP and its army of Maoist and jihadist trolls. There were signs of growing alienation in the breadbasket state of Punjab, which the ruling party foolishly fueled by alleging the protests were led by Sikh separatists.
Instead of the protesters giving in to intimidation, it was the Indian Prime Minister who was forced to retreat. The mobilization shattered the image of a strong man that Mr. Modi likes to project. It also signals a broader political failure of the ruling BJP. In 2016, the Indian Prime Minister promised that farmers’ incomes would be doubled by 2022. This would have required a rural family fortune to grow by around 10% per year in real terms. Not only did this never happen under Mr. Modi, it never happened under any leader.
Within India’s borders is about a third of all arable land in the Asia-Pacific region. Size matters and this year India made it into the top 10 agricultural exporters of the world. In an economy still reeling from the pandemic and with industrial investment and jobs still not picking up, agricultural GDP has grown over the past year.
Mr. Modi is expected to have constructive talks with farmers and develop new proposals that could help deliver better farm prices, while keeping essential food items affordable for India’s urban working class. India must replicate the success of its giant dairy cooperative at a time Free market and left-wing economists. This would be a way to increase income and productivity without leaving farmers vulnerable to commercial exploitation.
The biggest obstacle for Indian governments remains the trust deficit. Sections of Mr. Modis’ own party are questioning his compelling leadership. Opposition leader Rahul Gandhis predicted a year ago that the BJP would be forced to abandon agricultural reforms will do it no harm. With poor record, Indian prime minister could fall back on reigniting cultural wars in the next elections. It would be a bitter harvest for the farmers to whom Mr. Modi had promised a much better deal.
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