COVID-19 impact: Odisha promotes contract farming system

It leads to improved production and marketing of farm produce and livestock, says ordinance

May 21, 2020 10:42 pm | Updated 10:42 pm IST - BHUBANESWAR

The Odisha government has promulgated an ordinance allowing investors and farmers to enter into agreement for contract farming in view of the continuing uncertainties due to the pandemic.

Also read: Coronavirus package | Nirmala Sitharaman announces new law for contract farming in third tranche of economic stimulus package

According to the State government, the ordinance was aimed at facilitating both farmers and sponsors to develop mutually beneficial and efficient contract farming system.

It is argued that the new system will lead to improved production and marketing of agricultural produce and livestock while promoting farmers’ interest.

Since the Assembly is not in session, the ordinance has been promulgated.

The lockdown seems to continue for an indefinite period, said the ordinance.

The agreement will be entered into between the contract farming sponsor, who offers to participate in any component or entire value chain including preproduction, and the contract farming producer (farmers), who agree to produce the crop or rear the livestock.

The government has, however, made it clear that notwithstanding anything contained in the agreement, no title, rights, ownership or possession of land or premises or other such property will be transferred or alienated or vest in the sponsor or its successor or its agent.

Moreover, both the loans and advances given by the sponsor to the producer can be recovered from the sale proceeds of the produce and in no case be realised by way of sale or mortgage or lease of the land in respect of which the agreement has been entered into.

The government will constitute a “Contract Farming and Services (Promotion and Facilitation) Committee” to review the performance of the contract farming and to make suggestions to the government for its promotion and efficient performance.

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