Agricultural Federalism

This paper argues for a reassessment of the distinct and complementary roles of the union and states in the agriculture sector in accord with the spirit of the Constitution. It then goes on to spell out five principles consistent with these distinct but complementary roles. Finally, the paper concludes by noting that achieving this vision would require the states and union to embrace the kind of cooperative federalism that led to the realisation of the goods and services tax.

The authors are grateful to Bharat Ramaswami for detailed comments on an earlier draft and for discussions with several colleagues over many years, including Harish Damodaran, Ashok Gulati, Mekhala Krishnamurthy, and Pratap Mehta.

In 2021, the passage of three agricultural laws and their rollback, in response to protests, provoked a number of heated controversies: the lack of discussion and consultation by the union government, the need for providing greater freedom to farmers to sell their produce and lease their land, the apprehension that agriculture would be corporatised to the detriment of farmers, and the opposite apprehension that market-oriented reforms elsewhere in the economy would be put on hold because attempts in agriculture would be deemed to have failed.

One common feature to these discussions was their singular focus on the actions of the union government. Missing altogether was the role and responsibility of the states, which is somewhat ironic given that agriculture is a state subject under the Constitution.