Agriculture Policy Briefing

Agriculture Ministry Official says States to be Nudged Into Adopting New Model Marketing Law at 24 April Meeting

Ashok Dalwai, Additional Secretary (Agriculture), Photo by Vivian Fernandes

Additional Secretary Ashok Dalwai finds attitude of states helpful for agricultural marketing reforms but does not commit on fiscal incentives to push them into adopting new law, reports Vivian Fernandes

The union agriculture ministry will nudge state agriculture ministers to adopt the new model Agricultural Produce Marketing Committee (APMC) Act with its emphasis on private markets, contract farming and commodity trading on a countrywide electronic platform at their meeting on 24 April.

Additional Secretary in the agriculture ministry, Ashok Dalwai said there was a “greater realization” among states about the need for agricultural marketing reforms  which they felt were a “perquisite for high growth,” but he did not explain what had brought about the change of attitude, and whether fiscal incentives would be given to persuade them to adopt the model act,  as in the case of power distribution reforms.

Dalwai acknowleged that states had been tardy in adopting the 2003 model APMC Act, and even those that had legislated it had not taken steps to effectively implement it. States like Punjab did not want to let go of the regulated mandis  because of the huge tax they collect on wheat and rice procured through them for rationing. There was also pressure from the politically powerful constituency of commission agents and traders to go slow.

Dalwai said agricultural marketing reforms after legislation of the 2003 model act were “not robust.” They were “patchy, not liberal or progressive.”  The new model act would address those issues. The government was keen on creating a national agricultural market, so the laws and rules could not be restrictive.

Giving a report on the progress of the electronic-National Agricultural Market (e-NAM), the electronic trading platform that connects mandis across the country, Dalwai said 417 of them had come on board. Sixty-nine notified commodities were being traded. In the year to 10 April, 5.9 million tonnes had been traded online worth Rs 15,000 cr. (At Delhi’s Azadpur mandi alone 2.5 million tonnes of fruits and vegetables were traded in 2015-16).

Dalwai said the government had the following objectives for marketing reforms: (a) promotion of private market platforms in addition to the existing government regulated ones. He said Maharashtra had 41 private markets, Gujarat 25, Karnataka six and Rajasthan eight. (b) Direct marketing of produce between farmers and bulk buyers like exporters, processors and wholesalers or between producers and consumers (c) single point levy of market fee (d) single state-wide trading license (e) online trading and (f) contract farming. In addition, it wanted fruits and vegetables to be deregulated so farmers could sell them outside regulated mandis. 

The government wanted to replace physical trading with electronic trading  so traders did not collude and there was efficient price discovery. While the emphasis was on getting states to go electronic first, eventually the government wanted to create a unified national online market.

For this, the government was incentivizing mandis  with grants to install cleaning, assaying, grading and packaging facilities so that traders could buy and sell without physical inspection of commodities. Dalwai admitted that India did not have a strong commodity gradation system but  “tradable parameters” like ‘average’, ‘good’ and ‘better’ quality had been laid down for 69 commodities. The hope was that once farmers got used to producing to these parameters, they graduate to producing higher quality.

(Top photo of Ashok Dalwai by Vivian Fernandes).

Email This Page

Leave a Comment


Hit Counter provided by technology news
Web Design MymensinghPremium WordPress ThemesWeb Development

I Do Not Understand Bt Cotton technology; I Know It Works

Kallanagouda PatilY Kallanagouda Patil, 46, of Uppinbetegeri village in Dharwad taluk  owns 52 acres jointly with his three brothers. He holds a diploma in agriculture from a school in Raichur. Patil grows cotton on ten acres, apart from sugarcane, potato, Bengal gram, jowar, tur,moong and vegetables. He uses groundwater to irrigate his fields. The water is drawn from a depth of 280 feet. Electricity is free so he flood irrigates the fields, except the one under banana  where he uses drip irrigation. He does not micro-irrigate cotton because it is closely planted and has to make way for another crop after eight months. This farmer has his cost all worked out. Making quick mental calculations, he estimates the cost of cotton crop at Rs 22,500 an acre and the realization from 17 quintals an acre at Rs 68,000. He had planted Bayer seed. ‘I do not understand technology, he says, all I know is if I use Bt seed there will be no

Pests Snack on Chilly But Not Cotton

RudagiF Basavaraj Rudagi, 48, did not grow cotton before 2008. This farmer from Saundhi village in Dharwad district’s Kundogol taluk made a partial switch to Bt cotton as chilly was susceptible to pest attack and yield was declining. From five acres in 2009, Rudagi had fifteen of a forty acre joint farm under cotton this year, when smartindianagriculture  caught up with him in February. He tried out Bayer in a change from Mahyco and Raasi seed. Rudagi says he got 11.5 quintals (100 kg) an acre from his rain-fed crop and at Rs 4,050 a quintal, his realization was a little over Rs 46,000. The cost, he says, is Rs 26,000 an acre, excluding rental earnings had he leased out the land. This does not mesh with the profit he claims he makes, but then he admits to not keeping crop-wise accounts. Rudagi also grows peanuts, coriander, gram, safflower and jowar. There is safety in diversity. And yes he plants pigeon pea or tur around the cotton crop for bollworms to feed on so they are not forced by the survival instinct to develop resistance to Bt protein.  In this sense he is quite a cut apart. Low cotton prices are worrying but what is the alternative?