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New laws on agri trade in the pipeline

According to a senior agriculture ministry official, the government is working on a new law on contract farming. It is also creating a new law that will help farmers in physical and electronic trade across the country. This will be a welcome change since currently, mandis monopolise the trade and farmers are bound by the APMC regulations to sell produce to licensed middlemen in notified markets.

It will give the freedom to farmers to sell their produce to anyone who is offering a better price – whether on an electronic platform or in physical trade.  The regulation will simultaneously facilitate a major role for Farmer Producer Organizations (FPO), but without dislodging existing mandis that dominate the wholesale business in farm output.

“States will continue to earn Rs 6,000-7,000 crore annually through the government’s procurement process. The revenue of APMC from trading outside the mandi premises is minuscule and unaccounted,” the source said.