Agri Business

Ending APMC monopoly: Centre bites the bullet at last

Rajalakshmi Nirmal, BL Research Bureau | Updated on May 15, 2020 Published on May 15, 2020

APMC Consigned to history   -  THE HINDU

Farmers to decide to whom they will sell and at what price

While farmers may be disappointed with the Finance Minister for not having offered any immediate relief to face the stress from Covid-19 lockdown, they should appreciate the reforms that have been initiated, especially with regard to agri-produce marketing.

The Finance Minister on Friday said that there will soon be a central law to provide adequate choices to farmers to sell their produce in markets other than the traditional APMC.

Lifting barriers

This move will lift barriers in inter-State trade and there will be a framework for e-trading of agriculture produce.

It is welcome that the Centre has finally decided to bite the bullet, which will go against the traditional system and market lobbies to ensure free and fair trade for farmers.

The problem with the APMC structure was highlighted in a BusinessLine report, “It’s time to end monopoly of APMCs; food majors should be encouraged to procure directly”, dated: March 30, 2020.

It is well known that the APMCs across States have been dens of corruption, connected to caste and political networks.

So taking them head on and forcing an online platform — eNAM, for primary market trade in agricultural produce was itself a difficult task for the Centre in the last four years. But now the Centre has promised to offer a choice of markets to farmers, which will empower them.

However, one is not sure how the Centre is going to implement its plan.

Will the Centre set up a a new market platform for e-trade between farmers and end consumers or will the eNAM be scaled up.

Whichever way, APMCs are set to lose their monopoly.

The Centre has nudged Gujarat, UP, Madhya Pradesh and Karnataka to amend their APMC Acts and allow farmers to sell outside the controlled area of the latter, and now, the next challenge has been taken up.

To the question if the Centre will make ‘Agriculture Marketing’ an item in the concurrent list to go ahead with reforms, a highly placed source in the government says: “The GOI has the power to make intra-State and inter-State trade law, but this has to be outside the market.

“So, by Friday’s announcement of the FM it means the GOI will create a new trade zone which will be an alternative market for farmers”.

For dispute and grievance redress, an authority will be set up and the regulations that will be framed will take care of the governance structure.”


Published on May 15, 2020

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