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Contract farming guidelines: Farmer liability is limited

Farmers getting into into agreement farming arrangement with foods processors and other corporations will have liability limited to the advance that they receive or cost of farm solutions delivered by the sponsoring business, according to guidelines on the new get hold of farming ordinance issued by the Agriculture Ministry.

Also the sponsor under no situation can acquire ownership legal rights in excess of the farmers’ land.

The guidelines have plainly spelt out that the sponsor would be dependable for any decline of problems to the farming make, manufacturing website, property and any lawful consequence of inputs provided to farmers. Farmers, on the other hand, can not use inputs delivered by the sponsor for anything other than rising the make which has been agreed upon.


These are portion of a established of guidelines that the Ministry arrived out with for delivering a lawful framework for the Farmers (Empowerment and Protection) Settlement on Selling price Assurance and Farm Providers Ordinance, 2020, which the federal government passed early final thirty day period.

It reported the farming arrangement ought to be for a least time period of 1 cropping year or a utmost of five years. The agreement can be further than five years only if the single manufacturing cycle of the crop is a lot more than five years.

The arrangement ought to plainly suggest the mother nature of the farming, dimension of land spot, study amount of the farmer’s field, company address of sponsor, identify of the village and address of the farmer. The farmers getting into into the arrangement ought to have apparent title of the land. If the arrangement is with a farmer producer organisation (FPO), the guidelines insist on ensuring that the obligation for the overall performance of the arrangement is appropriately assigned among the customers of the FPO.

Similarly, if a sharecropper is concerned in the arrangement, he or she may well be built dependable for obtaining and applying inputs from the sponsor. No clause in the arrangement can be in derogation of legal rights of the sharecropper. The obligation to deliver the contracted portions would rest with the farmer.

If the make is rejected, the factors ought to be educated by the sponsor to the farmer and offer the farmer the chance to inspect the rejected consignment or have it inspected by a 3rd party. 3rd party may well be a licensed assayer, Krishi Vigyan Kendra, seed certifying company, or a capable agriculture scientist.

As for each the guidelines, if the sponsor fails to just take shipping and delivery of make inside the stipulated days outlined in the arrangement, the farmer may well market the make to a 3rd party and declare from the sponsor the variance concerning the price tag in the arrangement and the real price tag that he been given for the make. Sub-divisional authority can impose penalty up to one hundred fifty for each cent of the declare on the sponsor.

The make should be ordered at the price tag delivered for in the farming arrangement. The sponsor will have no proper to make everlasting change on the farmer’s field. But he can make momentary changes if the farmer agrees and he is obliged to restore the land to its authentic affliction prior to the expiry of the arrangement.

The guidelines also anxiety that the farmer of FPO ought to ensure that their ownership of the land is secure and lawfully valid prior to getting into into an arrangement. They ought to not choose for marketing or changing the ownership of the land when in an arrangement with the sponsor.

When disputes occur, the aggrieved party can demand from customers development of conciliation board. If the issue is not settled in 30 days, it can be escalated to the sub-divisional authority and if that way too fails an appellate authority, district collector, can hear the make any difference and the authority’s decision would be ultimate, the guidelines reported.