WB plans to introduce 'patnership farming' to free back-end retail

Under 'partnership farming' there would be tripartite agreement involving state, private players and farmers

Taking forward her recent pro-industry drive, the Mamata Banerjee-government is now planning to open up the state's back-end retail sector to private players by introducing the concept of 'partnership farming' as an alternative to contract farming mooted by the Centre.

A move in this direction would formally allow major retail players including Reliance, Metro Cash & Carry and Aditya Birla-More to purchase farm produce directly from the farmers in the state.

In fact, Reliance's retail arm had a big expansion plan of its agri-retail business in Bengal, much of which could not materialise as the Mukesh Ambani-led firm faced problems in securing licence under the APMC act in the state.

West Bengal chief minister Mamata Banerjee, who off-late seems to be on a drive to project the state as investor-friendly and, incidentally, met Mukesh Ambani during Mumbai industry meet recently, however understood to have given a green signal to amend the APMC act. Sources suggest, the matter is likely to be taken up in the next session of the state assembly.

There are two parts to Banerjee's plan: the first will allow companies to bypass the APMC licence for procuring directly from farmers, the second part is a PPP model for the back-end supply.

While the state government is opposed to contract farming as suggested in the Centre's model act, the state is planning to introduce its own version of the agricultural reform, namely "partnership farming", which the government claim would ensure certain safeguards for farmers.

According to sources, while the Centre's model allows an agreement between private players and farmers, in the "partnership farming" there would be tripartite agreement involving the state authority. The state government role will be that of a mediator and will have the right to settle disputes, if any. However, there will also be provision for moving court for an aggrieved party over any dispute.

When contacted state agriculture marketing minister Arup Roy said, " We are ideally opposed to the idea of contract farming as suggested in the Centre's model act. Some private players are doing this on their own, we do not want to interfere into that. We want private investment in the sector, but only after adequate safeguards for farmers' interest."

While amendment of the Agricultural Produce Marketing Committee (APMC) Act of 1972 would be necessary for the same, the state government may also intrioduce a new legisalation for this. The current APMC Act mandates that the companies procure from the mandis. The proposed amendment to the APMC Act may allow a unified license for buying and selling across the districts of Bengal.

Earlier, the Mamata Banerjee-government had roped in city-based Keventor group, the prime vendors to all large retail chains, to advise the government on this issue. Keventor, then, had recommended amendment of the APMC act.

Incidentally, the Centre also had been asking the state government to amend the Act since 2009. Although Budhadeb Bahttacharjee-government mooted the propsal, it could not go ahead because of its ally Forward Bloc's opposition.

After the TMC-government took over, the Centre had written to the state government on this. In February 2012, at a conference of chief secretaries, the Prime Minister had asked the states to amend the act.

Finally, the state government seems to have made its mind to implement the reform by introducing a model of its own. State agriculture department along with the law department is understood to be working on the fineprint for the model.