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All content following this page was uploaded by Swapnil Gupta on 27 July 2020.
Swapnil Gupta*
Prof. P. S. Badal**
ABSTRACT I. INTRODUCTION
Abstract Efficient markets offer efficient Agricultural Marketing in India has evolved
price discovery and level playing field for from being restricted to catering to local
all the actors. The paper systematically demand by having market yards within the
reviews developments in Indian range of farms to one which now aims to have
agricultural marketing and emphasizes on interconnectivity between markets of other
addressing the challenges in the States to have value dispersion between farms
implementation of e-NAM to achieve the and consumers. Emerging changes in
goal of doubling farmer's income; hence the agriculture marketing environment of the
challenge of poverty reduction as envisaged country i.e. electronic market, model act,
in SDGs. The research captures various warehousing, pledge loan, contract farming,
challenges in the implementation of e- etc. are ushering in opportunities for new
NAM in terms of 3 I's (Infrastructure, formats of markets which are effective in
Institution, and Information) and advocates responding to demand and supply. These
for strengthening the back-end of the supply changes will require investment in
chain with public-private interventions; infrastructure, infusion of technology and
amendment in state APMC Acts to building awareness and capacity building.
accommodate for e tendering operations According to a survey conducted by NABARD
and wide publicity of benefits of e-NAM in 2016-17, about 48% of households in India
among farmers are agricultural households, whose monthly
income is Rs. 3140 from crop cultivation alone
Keywords: APMC, Doubling framers
(NABARD 2018). On supply-side, India is a
income, e-NAM.
global leader in the production of pulses and
milk, second in fruits and vegetables, tea,
sugarcane, and cotton and third in cereals (GoI
2016b). This is quite a rosy picture. However,
one in every five individuals in the country is
poor and about 80% of the poor are rural poor
(World Bank 2016), who primarily depend on
agriculture for their livelihood. Agricultural
growth is more pro-poor (Xavier et al. 2001;
Christiensen et al. 2006; Douglas 2009;
Cerventes & Dewbre 2010; Dewbre et al. 2011;
Sharma & Kumar 2011; Grewal et al. 2012),
hence it holds promises to eradicate rural
poverty as envisaged in the sustainable
development goals (SDGs).
Electronic National Agriculture Market (e-
* Research Scholar, Department of Agricultural Economics, Institute of Agricultural Sciences,
BHU, Varanasi, Uttar Pradesh- 221005, E-mail: swapnilgupta.bhu@gmail.com
** Professor, Department of Agricultural Economics, Institute of Agricultural Sciences
BHU, Varanasi, Uttar Pradesh -221005
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BHU Management Review I Vol. 6, Issue-1&2 Jan. - Dec. 2018
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BHU Management Review I Vol. 6, Issue-1&2 Jan. - Dec. 2018
Buyers
Payment
National
Agriculture Traditional
(NAM) Fee
Customized (electronic
APMC State Full= to trading
and other electronic NAM platform)
(Credit)
market Platform
yard in of NAM
States
Supported and Maintained by
Ministry of Agri.
Exiting Channel
Payment
Figure 1: A Flow Chart of e- NAM
Issues in states with functional APMCs Andhra Pradesh, Gujarat, Haryana, Karnataka,
and Rural Markets Madhya Pradesh, Maharashtra, Punjab,
R a j a s t h a n , Te l a n g a n a , U t t a r P r a d e s h ,
Some of the major states where APMC and
Uttrakhand, etc. In these states, there is a clear
Panchayat/Municipal markets co-exist without
demarcation in the activities of APMCs and
hampering the business of each other are
rural markets. Rural markets are engaged in
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BHU Management Review I Vol. 6, Issue-1&2 Jan. - Dec. 2018
consumer-oriented retailing Activities while states, more than 10 percent of total Wholesale
APMCs are a platform for wholesaling market yards of the states have been notified for
activities. integration with e-NAM. In the case of
Uttrakhand, only 5 out of 66 wholesale market
Progressive and Dormant (Lagging) States
yards have been proposed for integration.
Among the states under this category, Similarly, in the case of Rajasthan, the
progressive states are Himachal Pradesh, percentage of yards proposed to be integrated
Telangana, Haryana, Uttar Pradesh, Andhra with e-NAM is limited to 7 percent, followed by
Pradesh, Madhya Pradesh, and Gujarat. In these Maharashtra (5%).
Integration of Markets
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BHU Management Review I Vol. 6, Issue-1&2 Jan. - Dec. 2018
learning from dairy and food processing 2006). This suggests the importance of the
industry where value chain integration has capacity building of farmers, traders, groups,
helped in optimal value realization needs to be co-operative, policymakers, etc.
adopted by the progressive state where e-NAM
NIAM has outlined a capacity building plan
is already operational.
for various actors namely farmers, traders,
Capacity building of market APMC secretaries, Directors. At the apex level,
participants: the Director needs to understand the
implementation of e-NAM and making
With the advent of E-Marketing in various
required policy changes, providing provision
states there emerges a requirement for capacity
for PPP model for E-marketing and creating
building of different stakeholders and
synergy for customized services. APMC
Institutions of Agri value chain. e-NAM is a
Secretaries and Chairman needs to build their
paradigm shift which will see new roles of
capacity in operation and management of
Market Functionaries, traders, farmers, etc.
electronic market, change management, dispute
Participation of different market functiona- redressal, consumer behavior, advisory, and
ries and farmers and service orientation of market information to farmers, etc. E-NAM
market officers is Imperative for the successful requires farmer linkages for selling produce.
rollout of E-NAM. The initiative in Karnataka The Farmer Producer Organization (FPO)
observed some unwillingness initial on from needs to be strengthened on Organizational
traders. These issues will require being handled skills, working in teams, Interpersonal
through regular training of farmers and other communication, work allocations,
stakeholders. The farmers rich in terms of
online payments and transaction, pledge
human capital are more likely to participate in
finance, etc. Training will help farmers better
new emerging supply chains (WorldBank,
Table 2. Capacity Building needs of Different Stakeholders of e-NAM
Stakeholders Components Covered
Farmer Understanding E-NAM, aggregations, market
trends & other opportunities
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institutions, logistics providers training and of Odisha to Electronic National market is not
extension organizations as markets are only going to be a feat of technology but also a
transforming towards on digital phase, diverse socio-cultural exercise. For bringing this
and discursive groups of clientele, public and transformation it needs to be recognized that not
private organization need to be integrated to all farmers and buyers will respond to this
provide customized services. These services transformation. The ability and willingness to
include assaying and grading of the produce, participate in the emerging markets driven by
price poling and information dissemination, information technology will depend on:
warehousing and disposal and commodity-
- Well-functioning markets to give them
based structured financing (Dey 2016).
appropriate incentives
- Farmers have access to finance and
4. Pathways to Integrate Farmers to information
Market
- Efficient infrastructure to store and
Linking sellers and buyers to markets is a transport the produce at a reasonable rate If
key factor that will bring better participation in one component is missing the farmer
the evolving markets and ensure better returns producers will not be willing to participate
to both sellers and buyers. Owing to the fact that to the same extent. Therefore, concentrating
the sellers are smallholder producers and have on these components to bring a holistic
constraints in access to markets the task of approach to market development is impera-
integrating smallholder producers to e-NAM is tive to have better market integration.
going to be a daunting one.
Enabling market connectivity through
Linkages with Market market information
Understanding the inter-linkages in Market information encompasses reliable
resources, production, risk, price and market price, buyer contact, market channel, grades
and how they affect the capability smallholders and standard specification, post-harvest
to participate in new opportunities is critical to handling advice and storage and transport
draw a path for integration of regulated markets recommendation. To achieve this pathway
with e-NAM. The Government of India's using Information technology not only to
“Make in India Campaign” aimed at making disseminate price but also to reduce transaction
India a manufacturing hub, is a significant step cost need to be in place. Investing in the
towards achieving employment intensive communication infrastructure such as mobile
growth as it seeks “to create 100 million phones network, internet linked rural kiosk
additional jobs by the year 2022 in the which aid in strengthening market information,
manufacturing sectorǁ. Generation of extension, and other services to farmers needs
productive and gainful employment with decent to be made.
working conditions on a sufficient scale to
Producer organization to offer a vital link
absorb the growing labour force was a critical
to market
element in the Eleventh Plan strategy for
achieving inclusive growth (Gupta, 2018). Technical and institutional innovations that
Incentives and constraints to market integration reduce transaction cost have proven to be
are realized differently by farmer producers and enablers especially the wider use of information
change as a result of market development. As technologies- mobile phone, the internet, and
the increasing opportunities are becoming social networks for vertical coordination
available to farmers as alternative markets such arrangements with farmers or producer
as e-NAM, the process of integration of buyers organization. Producer organization including
and sellers need to have a pathway. The leap in agricultural co-operatives plays an important
transforming the abandoned regulated markets role in supporting farmers to trade in the market
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place and understand the trends in marketing. This approach is what will make the
FPO and collective action can help to enhance markets function and provide services that
farmers' competitiveness and increase their add value and better returns
advantage in the emerging marketing system of
Adopting Model Agriculture Produce
e-NAM. Collaboration between FPO and
Livestock Market Act (2017)
Private sector built on their shared interest in
achieving scale and market power will be As per new Model Agricultural Produce and
critical in integrating Farmers to market livestock marketing Act 2017, the new
definition of the market area is now extended to
Market-Led Extension and capacity
the whole State/UT as one unified market area
building
for the regulation of marketing of all or any of
Market-led extension to transmit signals to the kinds of agricultural produce. This will go in
farmers on new market opportunities will make a long way in removing the entry barriers to
physical markets relevant to buyers and sellers. markets and at the same time arrest the problem
Extension functionaries have a key role to play of fragmentation of markets within the State.
in engaging farmers with markets. SWOT
Warehouses and silos to be declared as
analysis of the market, organizing commodity
market points
based farmer's interest groups and farm
management capacity building, backward and The new legislation also provides for
forward linkage, Farmer's exposure to market declaring warehouses/silos/cold storages or
intelligence and guidance for a quality decision another place as market sub yards. This will
about the market. Empowering farmers by provide better market access to farmers. In order
linking them to e-NAM information, services, to declare a warehouse as a sub-market yard,
and linkages through Market Led Extension is a warehouses which are fit to serve the purpose
long-term solution. may be notified. Generally, warehouses
accredited by WDRA may be selected to be
Linking rural periodic markets by
notified as a sub-market yard as the accredita-
upgrading them as PRAM
tion norms of WDRA requires warehouses to
As per there commendations of Report on follow scientific storage practices which
Doubling farmers income, the Rural periodic ultimately results in the quality keeping of the
markers need to be upgraded into a function that produce. The concept has been shaping up in
enables aggregation and transportation from Karnataka through initiatives of Rashtriya e-
village level to the wholesale market. It has Market Services Private Limited. A similar
been advised to build on the available infra- initiative has been seen in Punjab where silos
structure and experience of the RPMs to have been notified as Mandis.
establish a large number of primary rural
Good governance and innovations
agricultural markets (PRAM) to provide the
following two services: Efficient markets require good governance
and policy infrastructure, institutions and
I. Direct marketing between producers and
services that provide market information,
consumers
establish grades and standards, manage risk and
II. Aggregation platforms for the small lots create better opportunity to enhance income and
of farmers upgrade the existing markets and marketing
system to integrate with National Markets. It
In pursuing the establishment of PRAM, the
will require innovative pathways to achieve the
capability to connect produce in suitable
following
quantities with a market of choice will be
developed. Further with farmers enabled - High level of private participation in
with a choice of markets, the element of the grading, warehousing and scientific
market to market competition will follow. movement of commodities.
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Table 3. Various Component of the Market to be Achieved over a Different Period of Time
Phases/ Phase I Phase II Phase III
Components (0-2 years) (3-6 years) (7-12 years)
Enabling Legal (single license, Complete reforms Facilitating role
environments unified license, e-
trade, and others)
Infrastructure Hardware and Up-gradation of Creation of physical
software Mandies delivery centers and
collection center
Grades Selected commodities Comprehensive All commodities
coverage
Functions e-price discovery Bank settlement, MIS, promotion,
NWR, and logistics demand creation
Farmers participations Individual/groups Farmers groups/FPO Producers company
Skill development Mass Specialized As per global
awareness(extensive) requirements
Institutions Establishing a Institute for functions
national level like training, research,
agencies defining grades and
Identification of international trade
Special Purpose
Vehicle
Promotion NAM Portal Product Branding
Finance and insurance Direct payment Payment and credit Complete risk
coverage
Input and extension Information Advisory Delivery of physical
dissemination and
technical inputs
Focus Regional National Global
Agri Ecosystem Post Harvest Sanitary and Zero carbon footprint
Management phytosanitary
(Source: www.ccsniam.gov.in)
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Ÿ Gupta, S (2018). Employment and Skill Ÿ Yadav and Shalendra (2015). Make National
Development in India, Annals of Multi- Agri Market inclusive for small farmers.
Disciplinary Research, 8(III), 15-18. Business Lines 2015
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