Agri Business

eNam should not be forced on farmers, says Sanjay Kaul

Suresh P Iyengar Mumbai | Updated on November 15, 2019 Published on November 15, 2019

Finance Minister Nirmala Sitharaman’s advice to State governments to dismantle the Agricultural Produce Market Committees and move on to eNAM (electronic National Agriculture Market) has raised many eyebrows as the three-year-old nascent online platform is still facing teething troubles.

Addressing the sixth World Congress on Rural and Agricultural Finance earlier this week, Sitharaman said, “I want to place emphasis on eNAM. We are trying to get the States to scrap APMC, which has not been found to be efficient in helping farmers get better prices for their produce.”

She said that the APMC had served its purpose at one time but there are very many difficulties associated with it today. She added that the APMC, had become inefficient in helping farmers find better price for their produce.

Sanjay Kaul, Chairman, National Collateral Management, said that farmers should be given the choice to sell via eNAM, the traditional APMC mandi or sell directly to a buyer, whichever benefits him the most.

If a private mandi in his vicinity offers better services, he should have the choice to go there as well. eNAM should be an additional avenue, and should not replace other existing methods, he said.

Moreover, he said that buyers of farmer's stock today at APMC mandi’s are also the ones who had given loan to farmers during the sowing period.

Challenges remain

eNAM will face significant challenges trying to overcome these type of informal set up, added Kaul.

eNAM must also ensure farmers get paid on time and in full. This is a challenge as the current data shows that most eNAM transactions are settled outside the system. Payment gateway and account integration is the key to ensure the online platform succeeds, he said.

eNam should also ensure that the entire ecosystem including assaying and grading works in tandem to ensure that all-India participation works well.

This requires significant investment in infrastructure, the upgradation of mandis and driving awareness among farmers and traders.

Just investing in a bare-bone IT system with auction software will only translate into the bids being entered into the system and just data collection, he said.

Published on November 15, 2019
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