India Needs Agri-input Protection Laws

Farm producers desperately need support from the government to balance power with large commercial entities who wield it in the marketplace and courts of law.Unless some of the guilty agricultural input (seed, fertiliser and farm equipment) manufacturers and dealers are hauled up and given exemplary punishment, selling sub-standard agri-inputs will remain a flourishing business for all kinds of operators.

There is a need to draft a ‘farm inputs liability bill’ which should include all the agricultural inputs like seed, fertilsers, agri-chemicals and agri-equipments in its ambit. The controversial draft of seed bill (opposed by states of Bihar, AP and Kerala) does not hold the seed suppliers liable for any damage or crop failure. The bill holds companies liable till the seed germinates. What if the seeds germinate but fail to yield crops?

In the past, agricultural implied warranty (for sale of animals, semen, seeds) in the West had followed the argument like this that if an entity sells a bull to a farmer, which is to be used for breeding and the bull is not fit for breeding, the buyer may hold the seller liable for breaches of implied warranties of merchantability and fitness for a particular purpose. Why cannot the same logic be extended to India? One form of civil liability is products liability. Products liability refers to the legal liability for personal injuries and asset damage caused by defective products. Either the user of the product or others affected by the use of the product may file suit mainly on two grounds i.e. (1) negligence and (2) breach of implied warranty.

On the agri-input side, product liabilities have often been ignored. Farmer consumers are mainly confined to rural areas and are struggling with subsistence and marginal farming, lacking the legal capacities to fight back with large commercial interest. Consumers of agriinputs certainly can also use warranties to file suit for products liability. In any situation, a seller warrants that the product is fit for ordinary purposes for which it is used. If a seller knows the purpose for which the products will be used and the buyer relies on the seller’s skill or judgment in selecting or furnishing goods, then the seller impliedly warrants the fitness of the product for the purposes intended.

A person wishing to recover under negligence must prove that the producer or seller failed to exercise reasonable care in producing or marketing the product, resulting in an unreasonably dangerous product. This is very difficult considering the negligible resources available with the consumers. On the other hand the suppliers often point that the consumer has failed to exercise due care in using the input (product) and thus contributory negligence prevents the consumer from recovering any amount for injury or damage.

Needless to mention, “failure to warn” by the sellers also tantamount to a product defect. In addition to the common law, India needs to enact agri-input protection statutes by providing for specific remedies for a variety of agri-input product defects.

Published in The Economic Times