Lok Sabha Question No. 273 (UNSTARRED), answered on 2020-02-04
Subject: Linking Farmers with Markets
Ministry: AGRICULTURE AND FARMERS WELFARE
Asked by: Gowdar Mallikarjunappa Siddeshwara

## GOVERNMENT OF INDIA MINISTRY OF AGRICULTURE AND FARMERS WELFARE DEPARTMENT OF AGRICULTURE, COOPERATION AND FARMERS WELFARE

## LOK  SABHA UNSTARRED QUESTION NO. 273

TO BE ANSWERED ON THE 4 TH  FEBRUARY, 2020

## LINKING FARMERS WITH MARKETS

## 273. SHRI G.M. SIDDESHWAR:

Will the Minister of AGRICULTURE AND FARMERS WELFARE कृ ष एवं कसान कयाण मंी be pleased to state:

- (a) whether development and upliftment of farmers is the first priority of the Government and if so, whether the Government is working on a concrete plan to link the farmers with markets to help the farmers in trading of foodgrain and if so, the details thereof;
- (b) whether marketing of farm produce is carried out through the State Governments across the country and if so, the details thereof; and
- (c) whether forward trading is an index of predictive pricing and as a result, both buyer and seller can plan their futures trading and if so, the details thereof and the extent to which it would help farmers?

## ANSWER

## MINISTER  OF AGRICULTURE AND FARMERS WELFARE

कृ ष एवं कसान कयाण मंी (SHRI NARENDRA SINGH TOMAR)

(a) & (b): The Government has been working continuously and has taken several concrete steps to link the farmers  with the markets with the aim to help the farmers in trading of their foodgrain.  Agricultural  marketing  is  a  state  subject  and  wholesale  agricultural  marketing  is undertaken by the network of 6946 regulated wholesale markets, set up under the provision of respective State Agricultural Produce Market Committee (APMC) Act.

In  order  to  provide  better  marketing  facilities  to  the  farmers,  the  Government  has released  a  new  model  'The  Agricultural  Produce  and  Livestock  Marketing  (Promotion  & Facilitation)  Act,  2017'  in  April  2017  for  its  adoption  by  States/Union  Territories  (UTs).  The provisions therein provide for alternative marketing channels other than APMCs to farmers in marketing their produce at competitive & remunerative prices.

In order to optimise the use of scarce resources and mitigate the uncertainty in price and marketing, the Government has formulated and released a progressive and facilitative Model Act  'The  ----State/  UT  Agricultural  Produce  &  Livestock  Contract  Farming  and  Services (Promotion & Facilitation) Act, 2018' in May, 2018 for its adoption by the states/Union Territories (UTs). The aforesaid Model Contract Farming Act covers the entire value and supply chain from pre-production to post harvest marketing including services contract for the agricultural produce and livestock.

The  Government  has  implemented  National  Agriculture  Market  (e-NAM)  scheme  an online virtual trading platform to provide farmers with opportunity for transparent price discovery for remunerative prices for their produce through competitive online bidding system. So far, 585 wholesale  regulated  markets  of  16  States  and  02  UTs  have  been  integrated  with  e-NAM platform.

The  Government  is  implementing  Market  Research  and  Information  Network  (MRIN) Scheme  covering  3356  wholesale  mandies  across  the  country  linked  to  Agmarknet  portal, wherein Agricultural Produce Market Committees (APMCs) markets are reporting data on mandi arrivals and prices of their traded agricultural commodities on daily basis. The farmers have free access to the Agmarknet portal for getting market price information easily.

In order to ensure remunerative prices to farmers for their produce, the Government of India has launched an umbrella scheme 'Pradhan Mantri Annadata Aay SanraksHan Abhiyan' (PM-AASHA).  Under  PM-AASHA,  the  Department  of  Agriculture,  Cooperation  and  Farmers Welfare (DAC&FW),  Ministry of Agriculture & Farmers  Welfare, Government  of India, implements the Price Support Scheme (PSS) for procurement of pulses, oilseeds and copra. For  oilseeds,  DAC&FW also  implements  the  Price  Deficiency  Payment  Scheme  (PDPS)  and Private Procurement Stockist Scheme (PPSS).

The Government is also providing marketing facilities to famers  under the schemes of Paramparagat Krishi Vikas Yojana (PKVY) and Mission Organic Value Chain Development for North Eastern Region (MOVCDNER).

(c): Price discovery and price risk management are the major objectives of futures markets. Futures contracts of various durations and on multiple commodities are available for trading on these markets/ exchanges. Futures are standardized, exchange traded contracts for buying/selling  a  standardized  quantity  of  a  particular  commodity  at  a  pre-decided  price  on  a future date.

Farmers  and  growers  can  benefit  through  the  price  signals  emanating  from  futures markets even if they may not directly participate in the futures market. A farmer can determine the  kind  of  crop  which  he  would  prefer  to  sow  and  plan  his  cultivation  in  advance,  by  taking advantage of the advance information of the future price trends of alternate crops, and probable supply and demand of various commodities in future. Farmers can also simultaneously enter into the futures contract of the planted crop at the prevailing futures price thereby locking-in the price at which they can sell the underlying commodity at a specific point of time in future. In a futures contract, the farmer can deliver the crop directly on the exchange platform, subject to payment of market levies charged by the respective States.

As  per  the  Fifteenth  Report  on  'The  Forward  Contracts  (Regulation)  Amendment  Bill, 2010'  of  the  Parliamentary  Standing  Committee  on  Food,  Consumer  Affairs  and  Public Distribution, futures markets also lead to reduction in the amplitude of seasonal price variations and help the farmer realize somewhat better price at the time of harvest or to postpone the sale of his produce, in part or in full, thereby moderating market arrivals as well as the ability of the trader to monopolise price setting

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