Govt aims to end APMC monopoly with new model agriculture-market law

In a major move to liberalise agri-markets, the Centre has come out with a draft model law that seeks to end monopoly of traditional APMC mandis and allow private players and others to set up wholesale markets.

It would be a major agri-reform, if at least 15 BJP-ruled states adopt the new model law — Agricultural Produce and Livestock Marketing (Promotion and Facilitating) Act (APLM), 2017, as it provides wider options for farmers to sell produce and get better prices.

At present, farmers can sell their produce at regulated APMC (Agriculture Produce Marketing Committee) mandis only. There are 6,746 such mandis and each one is located at a gap of 462 km. They are subjected to different kinds of fees.

"Most states have agreed to implement the new model Act. Its implementation will help in doubling farmers' income by 2022," Agriculture Minister Radha Mohan Singh told reporters after a day-long meeting with state agri-ministers on the issue here.

Singh, Niti Aayog member Ramesh Chand, Agriculture Secretary Shobhana Pattanayak and 18 state agri-ministers and senior state officials were present at the meeting.

Last year, the Union Agriculture Ministry had set up a panel to draft a model act that would look at agri-marketing in a more holistic manner and suggest a legal template for states to adopt.

Since agriculture is a state subject, only states can implement laws related to the farm sector.

After the meeting, Uttar Pradesh 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." Singh was replying to a question if Uttar Pradesh would adopt the model law.

Rajasthan Agriculture Minister Prabhu Lal Saini said, "We will definitely implement as we want to increase the income of farmers. Livestock is not part of our mandi act. We will see how best we can incorporate this."

Haryana Agriculture Minister Om Prakash Dhankar said, "We welcome the entry of private players. There are some shortcomings but will see how best we can adopt the model template to our needs."

Stating that Adaman and Nicobar has different farm marketing challenges, Lieutenant Governor Jagdish Mukhi said, "There are small islands and there are different problems in connecting each island with the other. We will try to adopt this law in our own ways."

Niti Aayog member Ramesh Chand said, "This is a model law. States are free to adopt in totality or partially depending on their needs. If they give suggestions to improve the law, we will accept. So far, no one has pointed out loopholes."

Elaborating on the new model APLM Act, Additional Secretary in Agriculture Ministry Ashok Dalwai said: "If adopted by states, it will liberalise agri-market. The purpose is to create a single agri-market where with single licence one can trade agri-produce as well as livestock."

The government's aim is to set up a wholesale market at every 80 km.

The new law will end the monopoly of APMC and allow more players to set up markets and create competition so that farmers can discover prices and sell their produce accordingly, Dalwai said.

"APMC will be one of the markets. It will have no regulatory powers. The law promotes multiple market channels like private market yards, direct marketing and even godowns and silos can be notified as markets," he said.

Even an individual keen to buy bulk agri-produce for a big event like marriage can take licence and buy the produce but not more than three times in six months, he added.

The law seeks to set a separate authority to regulate all agri-markets including APMC and provide trading licences.

It caps market fee (including developmental and other charges) at not more than 1 per cent for fruit and vegetables, and two per cent for foodgrain. It caps commission agents' fee at not more than two per cent for non-perishables and four per cent for perishables.