Prelims level : Agriculture, Ignorance, Subsidy, Marketing Mains level : GS-III Major crops cropping patterns in various parts of the country, different types of Irrigation and Irrigation Systems Storage, Transport and Marketing of Agricultural Produce and Issues and related Constraints; e-technology in the Aid of Farmers.
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Why in News?

  • Following the Centre’s directive to States to amend their Agricultural Produce Markets (APMC) Acts, the Gujarat government has promulgated an Ordinance expanding the purview of the Act to include livestock under agricultural produce and to provide better market access to farmers.

What is APMC?

  • It is a statutory market committee constituted by a State Government in respect of trade in certain notified agricultural or horticultural or livestock products, under the Agricultural Produce Market Committee Act issued by that state government.
  • The Ministry of Agriculture formulated a model law on agricultural marketing, State Agricultural Produce Marketing (Development and Regulation) Act, 2003 and requested the state governments to suitably amend their respective APMC Acts.
  • Union Budgets of 2014-15 and 2015-16 had suggested the creation of a National Agricultural Market (NAM) following which e-NAM was launched on April 2016 as a pan-India electronic trade portal to link APMCs across the States.

What are its objectives?

  • Ensure transparency in pricing systems and transactions taking place in the market area.
  • Provide market-led extension services to farmers.
  • Ensure payment for agricultural produce sold by farmers on the same day.
  • Promote agricultural processing including activities for value addition in agricultural produce.
  • Setup and promote public private partnership in the management of agricultural markets, etc.

Changes Made and Their Implications:

  • As per the amendment, the new Act is termed Gujarat Agricultural Produce and Livestock Marketing (Promotion and Facilitation) Act, 1963.
  • The Act paves the way for establishment of a livestock market.
  • Also, it seeks to have involvement of local authorities, including Panchayati raj institutions that own and operate rural periodical markets such as haats within their area.
  • Changed Structure of the market committee of a market yard. It is deemed to be of national importance with increased membership from farmers.
  • A single licence will be applicable to the whole of the State for the traders to be granted or renewed by the Director. The existing trader licences granted by the market committees shall be converted into State wide single trader licence by the Director.
  • Now, even private entities can set up their own market committees or sub-market yards that can compete and offer the best possible remuneration to farmers for their produce.
  • The ordinance also restricts the jurisdiction of the market committees to the physical boundaries of their respective marketing yards. They can levy cess only on those transactions, happening within the boundary walls of their marketing yard.

Significance of these Changes:

  • The changes help develop these markets to efficiently function as marketing platform nearest to the farm gate.
  • They also ensure that the spirit of competition is encouraged and the principle of ‘farmer first’ is kept in mind.
  • Also, the act removes the conventional involvement of middlemen by allowing farmers to sell their crops in a free market. This is a progressive step towards a more robust farm economy.

Concerns from APMC:

  • APMCs have not welcomed the decision because it ends their monopoly and allows private players to enter.
  • The ordinance will also affect revenues because no cess will be collected on transactions outside the physical boundaries of marketing yards.
  • For example, last year, of the ₹5 crore earned as market fees, ₹1.5 crore came from transactions that were conducted outside the marketing yard. With the new ordinance in place, this revenue will be lost.
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