DBT is no miracle scheme, the Procurement Problems of Farmers remain unsolved.

After continued tussle between Punjab and Central Government over the implementation of Direct Bank Transfers scheme, Punjab government finally gave in paving way for a reform that was awaited from a long time. The reform of direct bank transfers is progressive and no person disagrees from this. The scheme however has not been able to solve the procurement woes of farmers in Punjab and Haryana.

The procurement season in Punjab started from April 10th with FCI’s agencies announcing that procurement will be done at MSP price (₹1925/quintal ) for wheat. While the national newspapers and some economists are calling the DBT as masterstroke they are ignoring the realities of its ripple effect on Punjab’s farmers and Arthiyas.

No Labour.

Many Mandis in Punjab face the shortage of labour. The impact of DBT is such that farmers have come into direct confrontation with Arthiyas who after their meetings with Punjab govt’s food and supply minister Bharat Bhushan Ashu got the provision of knowing how much money is transferred to the farmers. Basic understanding of Procurement cycle points out that labour is an important aspect of transporting and loading the grain in Mandis. The arthiya ecosystem had its own chain of labourers who depended on Arthiyas & worked on contract basis. Labour Sarvesh Kumar tells me in Bathinda that his Arthiya used to tell him the jobs during procurement season & he was never unemployed during the season. He says now that Arthiyas are not picking up the grain from all farmers he isn’t as busy as he was during the last season. He says that now Arthiyas are not getting paid up front so the payment of labourers is also halted in most cases. “I am told that when farmer will make payment, it will be given to you.” He says. The crunch of labour is seen in almost all the Mandis of Punjab even on the 7th day of procurement season.

Fate of 40,000 Arthiyas

The major concern of Arthiyas is that they were not an illegal entity & were regulated by APMC that guaranteed payment to them. The Arthiyas association of Punjab has been vocal with Minister Piyush Goyal about their fate as well. It is interesting to understand that 92% of the Arthiyas are urban Hindus who have been running the show since ages in Punjab. With a Hindu government at centre treating them like some ‘illegal entity’ the Arthiyas community is disappointed. The Arthiyas have also given credit to many farmers and have no way of knowing when they will be paid back. Even though the interest rates might be debatable here but the fact that these people are concerned about losing their money cannot he ignored as well.

Software Glitches

Even though Piyush Goyal clarified that farmers who cultivate on leased lands will be able to register as well, the concerns of farmers with respect to software don’t seem to end. The software requires farmer to register and upload his land details on the portal. This is an overhead task for the farmer who is busy in harvest of crop. The registration job as such has been taken by youth who charge farmers and register on the portal. The costs may not be very high ranging from 100/- to 150/- in some cases but the glitches in software have rendered some farmers helpless. When a farmer registers for his crop, he receives an SMs which acts as a gate pass for the Mandi. With glitches in software most farmers have not been able to receive the SMS causing confrontation at the Mandi gates. Another developing situation is about the banks included in the software. The software includes a list of 15 banks that are enrolled in DBT scheme. The farmers who don’t have their accounts in the listed 15 banks are faced with additional task of opening new accounts. Opening new accounts does cause problems for some farmers who have been black listed by banks either due to non payment of fines due to stubble burning or their earlier dues. This has put some farmers in jeopardy.

Shortage of Gunny bags.

Bharat Bhushan Ashu maintains that there is no shortage of gunny bags (also called as bardana) in Punjab but the millers and farmers face the regular shortage of gunny bags. The mandis in Fazilka used plastic bags for filling the grains. Punjab government even went to extent of notifying agencies that they can reuse the gunny bags. The shortage of gunny bags remains a concern when procurement season is on top.

Storage problems

Punjab and Haryana government have been vocal about the storage problems and have said that Mandis already contain the paddy that needs to be moved. The surplus paddy in the Mandis needs to be moved to make space for incoming grain. With shortage of space and labour as well the task of moving rice is becoming magnanimous. This has added to the woes of farmers sitting with their grain in the Mandi yards.

Sluggish procurement

The procurement season in 2021 has been the slowest of all. Even though Punjab government maintains that last grain will be procured at MSP the situation on ground says otherwise. Many mandis in Punjab and Haryana are yet to start procurement of grains and no agencies are seen there. The scenes at Fazilka mandi for first five days saw no government agency for procurement. Similarly Mandis at Fatehbad have not seen any FCI agency for procurement even on the 7th day. The situation in Haryana is more or less the same. The slow procurement or no procurement at some places has made it hard for farmers to believe in any of the eye wash policies. The promise of payment within 24hrs also seems to make farmers disillusioned with DBT. Some farmers have not received the payment since last 240hrs.


While the schemes like direct bank transfer are indeed needed to make transactions transparent, the need of the hour is to remove the implementation roadblocks in the schemes without rendering livelihoods at the mercy of God. The concerns of Arthiyas need to be addressed because they are not an illegal entity, the concerns of farmers with respect to slow and sluggish procurement need to be addressed along with the issue in the software.

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