New agri reforms not finding favour with stakeholders

Several government initiatives to address the flaws in the current agriculture marketing mechanism have not made much headway.

The major ones like electronic National Agriculture Market (eNAM) and the new Agriculture Produce and Livestock Marketing (APLM) Act, 2017, which will replace the Agriculture Produce Marketing Committee (APMC) Act, 2003, are facing stiff opposition from the stakeholders of the current agriculture marketing setup.

However, these two major reforms are expected to loosen the grip of the traders on the APMC mandis and open up a wider market for the farmers to derive better pricing for their produce.

For long, farmers have been at the mercy of traders and commission agents at the APMC mandis, which lack an efficient and transparent process of price discovery.

Experts say that despite being conceptually sound, these initiatives are facing implementation hurdle and their objectives could easily be scuttled in the milieu of a power struggle between states, Centre and other stakeholders.

Pravesh Sharma, former managing director of Small Farmers Agri-business Consortium (SFAC), is emphatic that APMC mandis need to be taken on to encourage competition.

“I don’t regard that (reducing the stranglehold of mandis) as a silver bullet to everything, but yes it’s a very important aspect of trying to bring better pricing norms to agriculture markets. That work has to be done by the state government. Today, 20 states are being controlled by the BJP. Why have these states not done it?” he said.

For instance, the online national agriculture market was meant to allow seamless and wide market access to farmers across the country and compete with APMC mandis. All this would have led to better pricing of agricultural produce for the farmers. On the ground, the reality is very different. Most states have diluted it to such an extent that it is emerging as a pale shadow of the APMC mandis.

“Here, there is a feeling that there is so much at risk politically in terms of alienating existing stakeholders (mandi traders), and not enough immediate payback in terms of support from the people who will be beneficiary of this change in the medium to long-term,” said Sharma.

On the other side, the model APLM Act, 2017 is expected to promote competition by allowing private sector and co-operatives to form wholesale markets. It will also bring livestock under it.

But even before it takes off, those in livestock sector are apprehensive on how it would affect their business.

A person associated with the livestock sector, who spoke on condition of anonymity, said today livestock farmers’ price is 70%-80% of the consumer price. He fears livestock farmers will lose their pricing power once the sector comes under the proposed Act.

“We believe that regulations have done a disservice to the agriculture crop. If you are now getting livestock in the APMC, please don’t make our plight similar to other commodities. Here (outside the APMC), the farmer has a say while in the APMC the farmer has no say. It is an APMC guy who initiates the bid and the trader finalises it, the farmer is just a mere spectator. He has the choice of taking his produce back but we know that is not practically possible,” said the person linked to the livestock sector.

Sharma has been severely critical about the way in which eNAM is being implemented and the excessive power the states wield in the whole process.

He has repeatedly slammed the states for shoddy execution of the online agriculture marketing reform and questioned why outside traders were not being allowed to bid on eNAM platform.

“So, far from creating a seamless, unified national market for agriculture produce, as e-NAM was grandly supposed to do, not even an integrated state-wide market has been created anywhere. The monopoly of the APMC mandis continue to be unchecked, with their long legacy of restricted competition among a handful of traders, opaque price discovery methods and poor service level to farmers,” he recently wrote on his blog.

STIFF OPPOSITION

• Government initiatives like electronic National Agriculture Market (eNAM) and the new Agriculture Produce and Livestock Marketing (APLM) Act, 2017, face opposition from the stakeholders of the current agriculture marketing setup