Narendra Modi will abandon contentious agricultural market reforms that sparked year-long protests from Indian farmers and a major challenge to his authority.
The Indian prime minister reaffirmed his conviction on Friday that the three new laws would have benefited farmers in the long-term, giving them access to more buyers for their crops.
But after 14 months of large sit-in protests on highways by farmers, who represent a politically influential constituency in India, Mr Modi added that his government had decided to repeal the laws in parliament's winter session.
“I urge farmers to return home to their families and let’s start afresh,” Mr Modi said.
The unexpected climbdown on such a big reform comes as Mr Modi's Bharatiya Janata Party gears up for state elections in Uttar Pradesh and Punjab, agricultural states where resistance to the laws has been fierce.
Farmers said the reversal reflected the BJP’s political anxiety following its defeat in West Bengal state elections in May during a devastating second Covid-19 wave.
“The government has taken back the legislation because of the fear of losing elections,” said Jaskarn Bawa, an 18-year-old protester whose family cultivates five acres in Punjab. “The BJP was routed in West Bengal and they knew a similar fate was awaiting them across the country.”
Political analysts said the U-turn might not assuage farmers’ intense anger towards the BJP, which had depicted them as terrorists and separatists for opposing the reforms.
"It's obvious that this decision was taken with electoral considerations, but it's not obvious that a loss on reform will return into a win at the ballot box because of the hardships the farmers have been through," said Gilles Vernier, a political-science professor at Ashoka University.
The new laws removed a bar on private companies from buying crops directly from growers, which Mr Modi argued would give farmers more freedom to transact and boost their earnings.
But farmers feared the legislation would pave the way for the state to stop buying grains at fixed prices, eventually leaving them at the mercy of powerful corporations.
Farmers were subdued after Mr Modi’s rollback pledge, expressing weary relief at the end of the stand-off, though protest leaders said they would not disperse until the repeal process was complete.
"What is there to cheer about?" asked Jagtar Singh (60), who cultivates 10 acres in Punjab. "The farm laws were wrong so he has taken them back. Who is going to pay for the losses we have suffered in the past 14 months?"
More than 600 demonstrators have died from heat, cold and exhaustion over the past year of protests, while four more were killed when a car owned by the son of India’s junior home minister rammed into them.
Abandoning the reforms will probably upset Mr Modi’s support base, as it undermines his image as a strongman impermeable to pressure from critics.
“It will not be perceived so much as a gesture in favour of farmers but as a retreat from a major policy reform that they made a hard promise not to retreat from,” Mr Vernier said.
The farm laws were pushed through parliament on a voice vote last year during the first wave of the pandemic, with no debate or notice. Opposition parties criticised the manner in which the legislation was passed and called for greater scrutiny and public consultation on policies affecting the livelihoods of millions. – Copyright The Financial Times Limited 2021