Agri Ministry to bring down market fee in APMC yard

The Ministry of Agriculture proposes drastic reduction  in the market fee and commission charges paid  in the Agricultural Produce Marketing Committee ( APMC) markets.

To this effect, it also suggest abolishing the present system of licensing of traders / commission agents  by substituting it with  system of registration. Accordingly, there will be a single unified registration  for the main market  and collection centres across the states to bring down the transaction charges.  

The  proposed Agricultural Produce Inter State Trade and Commerce ( Development and Regulation) Bill  could be implemented in states  with immediate effect for  enabling trading of perishable agricultural commodities to start with single   unified registration.  

As per the recommendations of the  Committee of the State Agricultural Marketing Ministers, the ministry has sought recommendations from all the states on these proposals  with the objective to better remunerise the farming community and make the pricing  of the agricultural commodities competitive in the global market to improve trade.

Accordingly, market fee/cess including rural development fund, social development fund and purchase tax should be maximum 2% of the value of the agricultural produce. The commission charges should not be more than two% for food grains/oil seeds and 4% for fruits and vegetables. In some states according to  official sources,  all inclusive these charges   work up to around 15% and on an average rule around 5-8% of the total value of the produce.

In order to encourage private sector investment in market infrastructure , the minister proposes to exempt market fee on trade transaction taking place inside the private market yard while states can levy minimal user charges  not exceeding 0.5% of the value of the produce  transacted.

Besides mandi fee/ APMC market fee) should only be levied on primary agricultural produce  and secondary products like  ghee, flour etc should be exempt from the mandi fee, while user charges can be levied.  Further, if a direct marketing entrepreneur is proving minimum specified infrastructure facility to the farmers, the concerned states should waive off market fee for such direct marketing activity. Similarly, developmental fee charged from private markets should be at par with APMCs and should be spent on infrastructure development outside the mandi.

While there should be a single window unified registration for traders and market agents  to function across states, market fee also should be levied  only for the first transaction between farmer and trader and not in the subsequent stages of sales. However for subsequent stages,  service charge  could be levied.