Responding positively to the suggestions by Federation of Indian Chambers of Commerce and Industry (FICCI) to encourage the private sector to foray into agriculture, the minister for agriculture and consumer affairs, food and public distribution, Sharad Pawar, assured them that he would take up the issue with Finance Minister P Chidambaram.
Speaking at the first regional Consultative Conference on APMC Model Rules, organised jointly by FICCI and the union ministry of agriculture, Pawar insisted it was imperative to strengthen infrastructure for warehousing, grading and packing of farm products. There is need for expediting various regulatory changes and implementation of the Negotiable Warehouse Receipt system, he said.
“The prevalent regulated domestic markets provide no help in direct and free marketing, organised retailing, and smooth raw material supplies for agro-processing, competitive trading, information exchange and adoption of innovative marketing systems and technologies,” Pawar said.
There was another positive development for private sector involvement in agriculture with the minister saying the Centre had requested state governments to suitably amend their respective Agriculture Produce Marketing Committe (APMC) acts for deregulation of the marketing system in the country.
FICCI had suggested amendment of APMC acts by states through putting in place a unified license for operating in all markets in a state, direct procurement from farmers’ fields, setting up of private market yard, contract farming, and e-auction trading, if the states are unable to repeal the acts.
“By now, 17 states and union territories have amended their APMC acts, while Bihar has repealed the Act. Seven other states and UTs do not have an APMC act. We expect that the remaining states would complete these amendments by March 2008,” Pawar said.
The minister’s concern for revamping the agriculture marketing system stems from the fact that infrastructural facilities in India’s regulated markets have remained inadequate due to inappropriate market infrastructure.
The minister regretted that over time, regulated markets have acquired the status of restrictive and monopolistic markets, devoid of competition. Negligible application of modern but cost-effective technology for reducing losses and wastage in the supply chain has neither helped the farmer nor the consumer. This has perpetuated the low utilisation of the processing capacity, he said.
“The strengthening of our domestic marketing system should be in such a way that it helps in responding to the challenges and opportunities that the global markets offer in the liberalised trade regime,” Pawar said.
– Sri Krishna
