Centre issues model law to end APMC monopoly

States, if they agree, will need to adopt this as farm marketing is in their jurisidiction

The central government on Monday issued its model of a law to replace the one of 2003 for the Agricultural Produce Marketing Committee (APMC) Act. Under the new model, buyers might not have to pay more than 1 per cent of the transacted value as mandi fee in case of fruit and vegetables and two per cent in case of other items.

Agriculture is a state subject; the Centre can recommend what it wishes to see. The new model would open the door for multiple modes for sale and purchase of produce — private wholesale market ('mandis'), market yards operated by groups of individuals, licences to private entities for temporary bulk purchase directly from farmers. All towards the aim of ending the decades-old stranglehold of mandis in this regard. 

The mandi tax, by the new model law, won’t be under any condition charged from the farmer or seller. Agents would to be allowed a commission of more that two per cent by value for non-perishable items; for perishables like fruit and vegetables, not more than four per cent.

The Act would also empower the state director of agricultural marketing as the sole authority for granting trading licences to traders or commission agents, taking this over from existing APMCs. 

The new model was unveiled at a meeting between the central and state agriculture and agricultural marketing ministers. “The majority of states were positive about the new Act. Some others said they'd first study it and then comment,” said agriculture minister Radha Mohan Singh.

To be called the Agricultural Produce and Livestock Marketing (Promotion and Facilitating) Act or APLM, the new model would also enable any agricultural processing company, retail chains like Walmart or Big Bazaar, farmers’ cooperative with linkages to retail chains and farmer-producer companies to purchase farm goods directly from cultivators, outside the limits of any mandi or private market yard, after getting a licence for doing so. 

Stock limits under the Essential Commodities Act won’t  apply to such bulk purchasers. They'd have to pay 0.25 per cent of the licence fee towards a Marketing Development Fund.

“Even an individual keen to buy bulk agri produce for a big event like a marriage can take a licence and buy the produce but not more than three times in six months,” said Ashok Dalwai, additional secretary in the ministry.

After the meeting, Uttar Pradesh's agriculture marketing minister, Swati Singh, told PTI: "We welcome the new law. We are already implementing some of the features. We will study and take a call." Rajasthan's Prabhu Lal Saini said they'd definitely implement the model.