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Richa Mishra | Updated on January 02, 2019 Published on January 01, 2019

Using LPG dealerships to sell farm produce will help farmers

Why can’t the dealer network be used for selling onions and potatoes?” asked a LPG dealer. It is a valid question and could also provide a readymade market accessible to farmers. As on December 1, 2018, there were 22,328 LPG distributors in the country with a consumer base of over 25 crore. The oil marketing companies will soon release the sixth crore connection, under the Pradhan Mantri Ujjwala Yojna (PMUY). According to oil marketing companies, there is no provision currently to bifurcate the LPG consumption based on ‘urban’ and ‘rural’ areas. Further, with a view to strengthen the LPG distribution infrastructure and simplify the process of refilling of gas cylinders, oil marketing companies plan to set up 6,400 more outlets, mostly in rural areas, for which it had put out advertisements. Oil marketing companies anyway are selling non-fuel items through their fuel retail outlets and some even have tie-ups with large FMCG firms, so why not use the LPG dealer network for selling farm produce? The proposal can even be politically beneficial.

All LPG distributors except Durgam Kshetriya Vitraks are under instructions to make home delivery of LPG cylinders in their authorised area of operation, including rural areas. So they can even make door delivery of fruits and vegetables.

In fact, even if the LPG dealers have to procure the farm produce at subsidised rates they will not be losing out, given the volumes they are likely to sell.

The government has been taking measures to incentivise farmers, such as hiking the export incentives granted for onions under the Merchandise Exports from India Scheme (MEIS) to 10 per cent from 5 per cent. This, according to the government, will result in better price realisation for onions in domestic markets, given the increased arrivals in the market and the subdued price trend in mandis.

Making use of local LPG dealer network will give a ready-made market to farmers and also ease the distress the agrarian sector is currently facing.

Richa Mishra Associate Editor

Published on January 01, 2019

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