Agricultural Marketing Reform Through Elimination of Intermediaries

 

Report Overview:

  • Agricultural markets in most states of India are established and regulated under State APMC (Agriculture and Marketing Committee) Acts, which led to the creation of regulated markets, called mandis.
  • Today, the country has 7,246 such mandis each of which caters to an average area of nearly 450 sq km.
  • Introduced in the 1960s, APMC Acts prohibited farmers from dealing directly with retailers and required them to sell their produce to licensed middlemen or market functionaries.
  • In the absence of market information farmers have not got remunerative prices and the middlemen have got the major share in profit.
  • Post the circulation of Model APMC Act by the Central government to States in 2003, many states have amended their APMC Acts to allow for transparency in agricultural marketing to provide for Direct Marketing and Contract Farming, which would help in the elimination of intermediaries leading to better prices for consumers and returns for farmers.
  • By 2012, 16 States had reformed their APMC Acts to provide for Direct Marketing and Contract Farming.