Agricultural Marketing Reforms



            The Ministry of Agriculture, Government of India set up a Committee under the Chairmanship of Shri K.M.Sahni, Additional Secretary, Department of Agriculture and Cooperation to formulate a Model Law on Agricultural Marketing in consultation with the States. The Committee discussed at length the different provisions of State Agricultural Produce Marketing (Regulation) Act and finalized the Model legislation on 8-9th September, 2003 at Pune and the report has been submitted to the Government. To implement the various Reforms measures by the States/ U.Ts. Governments, a National Conference of State Agriculture Ministers was held on 7th January, 2004 at National Science Centre, ICAR Complex, Pusa, New Delhi under the Chairmanship of Union Agriculture Minister Shri Raj Nath Singh.  There was overwhelming response by the State Governments on various reforms measures and the Hon’ble Agriculture Minister, Government of India requested the State Government to implement the same within one year.


The draft model legislation titled the State Agricultural Produce Marketing (Development and Regulation) Act, 2003, provides for establishment of Private Markets/ yards, Direct Purchase Centres, Consumer/Farmers Markets for direct sale and promotion of Public Private Partnership in the management and development of agricultural markets in the country. It also provides for separate constitution for Special Markets for commodities like Onions, Fruits, Vegetables, Flowers etc. A separate chapter has been included in the legislation to regulate and promote contract-farming arrangements in the country. It provides for prohibition of commission agency in any transaction of agricultural commodities with the producers. It redefines the role of present Agricultural Produce Market Committee to promote alternative marketing system, contract farming, direct marketing and farmers/consumers markets. It also redefines the role of State Agricultural Marketing Boards to promote standardization, grading, quality certification, market led extension and training of farmers and market functionaries in marketing related areas. Provision has also been made in the Act for constitution of State Agricultural Produce Marketing Standards Bureau for promotion of Grading, Standardization and Quality Certification of Agricultural Produce. This would facilitate pledge financing, E-trading, direct purchasing, export, forward/future trading and introduction of negotiable warehousing receipt system in respect of agricultural commodities.


It is hoped that the model legislation will enable nationwide integration of agricultural markets, facilitate emergence of competitive agricultural markets in private and cooperative sectors, create environment conducive to massive investments in marketing related infrastructure and lead to modernization and strengthening of existing markets.