Recently, the Punjab Assembly has stood against the Centre’s newly presented farm ordinances and the proposed Electricity (Amendment) Bill 2020 via passing a resolution. These legislations were a part of the third economic package under Atmanirbhar Bharat Abhiyan, introduced to counteract the impacts of the Covid-19 pandemic.
The Centre’s Reforms: Farm Ordinances and Bill
Three key ordinances were introduced by the Centre: Farmers’ Produce Trade and Commerce (Promotion and Facilitation) Ordinance, 2020; Farmers (Empowerment and Protection) Agreement on Price Assurance and Farm Services Ordinance, 2020; and Essential Commodities (Amendment) Ordinance, 2020. Expected to bring ease of agricultural trade, these ordinances aim to allow seamless movement of farm produce between various states and give farmers the choice of their market.
In parallel, the Electricity (Amendment) Bill 2020 is aimed at centralizing the power sector via the establishment of an Electricity Contract Enforcement Authority. The bill also recognizes franchisees and sub-licensees, potentially opening doorways for private players in the sector.
Criticisms of the Reform
One of the main criticisms concerning these ordinances is related to state governments’ loss of income, as they can no longer levy any market fee, cess or levy on farmers, traders, and electronic trading platforms for any trade executed under the ordinance. This specifically affects the incomes originating from Agricultural Produce Market Committee-controlled trading.
Furthermore, these ordinances are seen as undermining state powers and disregarding state laws and market committees, essentially infringing upon functions of the state governments.
Punjab’s Dissent
The Punjab Assembly contends that these ordinances are infringing upon the constitutional schemes of India. Entry 14 of List II of the Constitution recognises agriculture as a subject for the states, indicating that these ordinances are directly against the constitutional arrangements and the spirit of cooperative federalism — a system for administrative cooperation between the Centre & states and within states.
Legislative Subjects Distribution
Article 246 of the Indian constitution establishes a threefold distribution of legislative power between the Union and the states: List-I constitutes the Union List; List-II covers the State List; and List-III identifies the Concurrent List.
The Union has exclusive legislative powers concerning matters of national importance which require uniformity of legislation nationwide, including defence, banking, foreign affairs, currency, atomic energy, communication, inter-state trade and commerce, among others.
The state legislature has exclusive powers (outside emergency periods) to legislate on matters of regional or local importance, encompassing areas like public order, police, public health and sanitation, agriculture, and more.
Both, Parliament and state legislation can enforce law-making rights over any matter listed in the Concurrent List. This includes subjects like criminal law and procedure, civil procedure, marriage and divorce, electricity, labour welfare, drugs, newspapers, books and printing press, etc., which require legal uniformity nationwide but is not essential.
In addition, the Parliament has the authority to create laws related to residuary subjects, i.e., matters not outlined in any of the three lists. It also has the right to enforce laws on any part of the Indian territory not included in a state, even though the matter may be listed under the State List.
Last Modified: February 8, 2024