Indian Prime Minister Narendra Modi has decided to repeal three controversial farm laws against which farmers have protested for more than a year.
Subscribe now for unlimited access.
or signup to continue reading
The move represents a significant climbdown by the government and its combative leader.
The sudden concession on the three laws comes ahead of elections early next year in Uttar Pradesh, India's most populous state, and two other northern states with large rural populations.
"Today I have come to tell you, the whole country, that we have decided to withdraw all three agricultural laws," Modi said in an address to the nation.
"In the parliament session starting later this month, we will complete the constitutional process to repeal these three agricultural laws."
The legislation, introduced in September last year, was aimed at deregulating the sector, allowing farmers to sell produce to buyers beyond government-regulated wholesale markets, where growers are assured a minimum price.
Farmers, fearing the overhaul would cut the prices they get for their crops, staged nationwide protests that drew in activists and celebrities from outside India, including climate activist Greta Thunberg and singer Rihanna.
Modi's capitulation leaves unresolved a complex system of farm subsidies and price supports critics say the government cannot afford.
It could also raise questions for investors about how economic policy is being overwhelmed by political interests.
Many of the biggest protests are centred around the capital New Delhi, where farmers have been camped by the roadside since last November, demanding the laws' repeal.
Rakesh Tikait, a farmers' group leader, said the protests were not being called off. "We will wait for parliament to repeal the laws", he said on Twitter.
The protests took a violent turn on January 26, India's Republic Day, when thousands of farmers overwhelmed police and went on to storm Delhi's historic Red Fort after tearing down barricades and driving tractors through roadblocks.
One protester was killed and scores of farmers and policemen were injured.
Small farmers say the changes make them vulnerable to competition from big business and that they could eventually lose price support for staples such as wheat and rice.
The government says reform of the sector, which accounts for about 15 per cent of the $A3.7 trillion economy, means new opportunities and better prices for farmers.
The laws were targeted at empowering small farmers, but the government failed to convince those who have been opposing the new legislation, Modi said.
Australian Associated Press
