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Reforms in Agri-Marketing
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Reforms in
Agri-marketing
To make agri-marketing viable, an expert committee was set up by the initiation of Central Govt. Establishment of this committee is to observe and analyze-justify Indian agricultural condition, and to suggest necessary recommendations which will enable Indian Agriculture sector to transfer from Agri-Base metaphor to Agri-Business metaphor. The abstract of the report is as such:
 

Observations

 

The major observations on competitiveness of Indian agricultural for exports are:

  • Post-harvesting handling cost very high on account of freight rates,  
  • Lack of refrigerated facilities,  
  • High incidence of losses and non-availability of quick transport,
  • Fruits & vegetables productivity is 50% less with comparison to world productivity,  
  • Higher prices of products makes uncompetitive in world market,
  • Country’s agro-climatic conditions are conducive for large variety of fruit and vegetables to be grown round the year with good seed, plant material and improvised technologies to improve export competitiveness.
 

Suggested Strategies

 
  • Create national market for primary agricultural produce without any control orders.  
  • Develop markets as service provider & efficiently managed through required facilities like electronic auction, market-led extension facilities, etc.  
  • Grading, packing, storage facilities must be provided at market.  
  • Forward & future-trading mechanism may be introduced through private sector participation and Govt. has to act as service provider/facilitator for conduct of business.
 

Conclusion & Suggestions

 
  • Provision of conducive environment for private sector participation in infrastructure development,
  • Legally sound warehouse receipt system for farmers, credit against stock pledging,  
  • Essential commodities Act and APMC Acts need review and amendments for securing effective role of stakeholders,  
  • Strengthening market intelligence and market-led extensions for better competitive marketing, enabling
  1. Changed-liberalized atmosphere,  
  2. Direct marketing,
  3. Contract farming involving private sector, corporate etc. 
  • Development of marketing infrastructure of 10th plan has to be linked to reforms with State government’s initiations to avail the benefits,  
  • Actions by State Governments & Union Territories,  
  • To give views in regards to the reforms, 
  • Initiate necessary measures to strengthen agricultural marketing in the country.
 

Scheme for Construction of Rural Godowns

 
1.

Creation of scientific storage capacity with allied facilities in rural areas.

2.

The project for construction of rural godowns can be taken up by individual farmers group of farmers /growers, Partnerships /proprietary firms, Non-Government Organizations (NGO's), Self Help Groups (SHGs), Companies, Corporations, Co-operatives, Agricultural Produce Marketing Committees, Marketing Boards and Agro Processing Corporations.

3.

The entrepreneur will be free to construct godown at any place and of any size as for his commercial judgment.

4.

Godowns built under the scheme shall be required to obtain license from the state Warehousing Corporations to operate such godowns under the State Warehousing Act.

5.

Rate of subsidy shall be 25% of the capital cost of the project. (For North-Eastern states) but for SC/ST entrepreneur, the rate of subsidy shall be 33.33%.

6.

Subsidy under the scheme is linked to institutional credit and will be available to only such projects as are financed by commercial banks, cooperative banks & regional rural banks. Loan to the entrepreneurs from banks for the construction/ renovation / expansion of godowns etc. would carry an adequate long-term repayment period.

7.

Assistance under the scheme shall be available on capital cost of construction of godowns only. However banks are free to finance, in addition to storage, allied facilities like consumer shop, agri-clinics, weighing, grading, packaging & quality certification, warehousing etc. to meet various requirements of the frames.

8.

The Farmers keeping their produce in the godowns shall be eligible to pledge for loan.