Making successful agricultural market reforms

It should help attract private investment in agriculture and help farmers of cereals, pulses, oilseeds, onion and potato, who have been adversely affected by the policy regime hitherto that discouraged private investment.

These are expected to enable inter-State trade and promote contract farming, thereby providing a large number of options to farmers.

However, there are several difficulties that need to be addressed before the full benefits of these policies are realised. One of such things to mention is
- ‘Time-inconsistency’ problem, or in simple terms, the policy credibility problem.
- This situation arises when a decision maker’s preferences change over time in such a way that the preferences are inconsistent at different points in time.

Because the policy signals are not very clear in the last few years as relates to agricultural marketing. For example
e-NAM

National Agriculture Market (eNAM) is a pan-India electronic trading portal which networks the existing APMC mandis to create a unified national market for agricultural commodities.
It is an online trading platform for agriculture produce aiming to help farmers, traders, and buyers with online trading and getting a better price by smooth marketing.
It was launched by the Centre in 2015 and the government had to extend it in a phased manner across the 585 mandis of the country by December 31, 2019.
Small Farmers Agribusiness Consortium (SFAC) is the lead agency for implementing eNAM under the aegis of the Ministry of Agriculture and Farmers Welfare.

For the farmers, NAM promises more options for sale. It would increase his access to markets through warehouse-based sales and thus obviate the need to transport his produce to the mandi.
For the local trader in the mandi / market, NAM offers the opportunity to access a larger national market for secondary trading.

The Union Agriculture Minister recently launched new features of e-NAM platform. They are important steps in our fight against COVID-19.
They will strengthen agriculture marketing & reduce the need for cultivators to physically come to the mandis to sell their produce.
The newly launched software modules are namely
- Warehouse based trading module in e-NAM software to facilitate trade from warehouses based on e-NWR.
- FPO trading module in e-NAM whereby FPOs can trade their produce from their collection center without bringing the produce to APMC.
- Enhanced version of the logistic module has been released whereby aggregators of transport logistic platforms have on boarded which helps users to avail trackable transport facilities for transporting their produce.

States needed to amend their respective Agricultural Produce Market Committee (APMC) Acts to put in place three prerequisites for the success of this programme
- a single licence across the State;
- a single-point levy of the market fee; and
- electronic auctioning in all the markets.
Several States could not or did not carry out these amendments and the e-NAM proved to be far less effective than desired.

https://www.thehindu.com/todays-paper/tp-opinion/making-agricultural-market-reforms-successful/article32451422.ece

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