Farmers need a choice in selling their produce and the electronic trading platform developed by the centre will be the turning point in their economic life, Prime Minister Narendra Modi said on Thursday, while launching the National Agriculture Market, or e-NAM.
“Farmers are often forced to sell at a distress prices in the closest mandi (market) and the e-NAM platform will allow them to sell their produce anywhere in the country,” Modi said, adding, “while farmers will earn more, traders will have a wider choice and consumers can expect lower prices”.
The e-NAM platform—a key initiative of the National Democratic Alliance government’s promise to double farm incomes by 2022—will connect 21 mandis from eight states in the first phase. The centre aims to bring 585 mandis across India on to the platform by March 2018.
Horticultural crops such as onions and potatoes are often sold at varying rates in different states and a unified market can help bring a parity in prices. Falling prices of key commodities such as rice, wheat and cotton have dented farm incomes in the past few years, while consecutive droughts have led to a protracted period of rural distress.
Fourteen states have amended their Agricultural Produce Market Committee (APMC) Acts—state laws that currently govern how farm produce can be traded—to allow for electronic trading, and the centre has approved 365 mandis from 12 states to join the platform.
Modi urged all states to come on board the project. “Some states do not have marketing laws and others have to amend existing laws to join the platform,” he said, adding, “the initial success of the project will force others to join the project”.
The eight states that will be part of the platform in the first phase are Gujarat, Telangana, Rajasthan, Madhya Pradesh, Uttar Pradesh, Haryana, Jharkhand and Himachal Pradesh. The platform will begin by trading in 25 crops, including wheat, maize, pulses, oilseeds, potatoes, onions and spices.
Initially, farmers will have the choice to sell at any mandi within the state, and the goal is to widen this to across the country, according to an official from the agriculture ministry who did not want to be named.
But a national common market may not be a reality soon as states have to amend their marketing laws further. “The government has formed a committee to look into the statutory requirements (as agriculture and marketing are state subjects) that can allow farmers and buyers to trade at a pan-India level,” the official added.
States are often reluctant to let go of taxes and levies imposed on the marketing of agricultural produce. Punjab, for instance, known for its strong network of arthiyas (traders), has not given in-principle approval to the e-NAM scheme. Further, states like Kerala and Bihar that do not have an APMC Act have to take a call, agriculture minister Radha Mohan Singh said earlier this week.
While launching e-NAM, Modi said the scheme will bring transparency and policymakers will have a better idea of real-time availability of crops. This will help smoothen movement of crops from surplus to deficit areas, he said. “Today we cannot look at farming in bits and pieces,” he said, adding, “agriculture needs a holistic and science based approach.”
He elaborated on other major thrust areas of the government—increasing water use efficiency or “more crop per drop”, restoring soil fertility and diversifying into fisheries and livestock to improve farm incomes.
Modi further said that farmers should move towards value addition of agricultural produce, and the government’s decision to allow 100% foreign direct investment in the food processing sector is an important policy decision in this regard.