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Sunday, December 05, 2021

Central farm laws to hit Punjab where it hurts most: mandi and rural development boards

The Punjab government claims that if the earnings of these boards are stopped, the state will find it difficult to maintain over 31,000-km of rural link roads as well as farmers’ welfare schemes, including the debt relief scheme.

Written by Anju Agnihotri Chaba | Jalandhar |
Updated: October 29, 2020 3:55:40 pm
Central farm laws to hit Punjab where it hurts most: mandi and rural development boardsHaryana government has procured 55.07 lakh metric tonne (LMT) paddy at 200 grain markets and procurement centres till November 18. (Express photo by Anju Agnihotri Chaba)

The implementation of Farmers’ Produce Trade and Commerce (Promotion and Facilitation) Act, which removes restrictions on farmers selling agri-produce outside the notified Agriculture Produce Market Committee (APMC) yards, has not only brought the very existence of six-decade-old Punjab Mandi Board (PMB) under cloud, but it is also set to hit the three-decade-old Rural Development Board (RDB).

Both PMB and RDB are major revenue earners for the state, and are also the biggest infrastructure builders next only to the Public Works Department.

The Punjab government claims that if the earnings of these boards are stopped, the state will find it difficult to maintain over 31,000-km of rural link roads as well as farmers’ welfare schemes, including the debt relief scheme.


The PMB earns nearly Rs 1,950 crore annually as Market Development Fee (MDF), which is 1 per cent on cotton, maize, and potato; 2 per cent on fruits and vegetables, and 3 per cent on wheat, rice, barley and paddy. This amount is shared between the PMB, which keeps Rs 1,200 crore, and market committees, which get Rs 650 crore.

Apart from this, the PMB also earns some revenue from selling off its plots, and leasing out maize driers, cold rooms and ripening chambers, which it has set up over the past decade.

Similarly, RDB’s annual income is around Rs 1,850 crore, which mainly comes from 3 per cent Rural Development Fund (RDF) charged from the purchaser of crops. The annual income of both the boards comes to around Rs 3,800 crore, and a major portion this comes from central government’s purchase agency FCI, which buys around 13 million tonnes of wheat and 16 million tonnes of paddy.

The PMB, which was set up under the Punjab Agriculture Produce Markets Act, 1961, is entrusted with the responsibility of developing mandis/mandi infrastructure to facilitate farmers in selling their agricultural produce. The amenities it provides includes auction platform, sheds, office buildings, canteens, roads, electrification and public health services, etc.

The RDB, on the other hand, was incorporated in April 1987 under Rural Development Act, 1987 and is mandated with the promotion of better agriculture, and granting relief for the loss and damage to agricultural produce. It also provides the facility of streets lights, dharamshalas, panchayat ghars, canals and drains, government health infrastructure, drinking water, sanitation, and government educational institutions in rural areas.

Both the boards share a huge burden of the state’s expenditure.

PMB, which is the nodal agency for rural link roads, takes care of 14,600 roads with a total length of 31,988 km out of the 64,878 km-long link roads in the rural areas, including high (28,705 km), medium (26,437 km) and low (9,736 km) traffic volume roads. The remaining 15,647 link roads that are 32,890-km long are maintained by the PWD.

“The PWD and PMB maintain these roads on almost 50-50 basis, and PMB does so from its own earnings,” said a senior officer of the PMB, adding that these roads are repaired and re-carpeted every six years by the PMB.

“Nowhere in the country is there such a fine system of roads linking rural areas with the main roads and market committees so that farmers can easily bring the grain to the mandis. One can find a mandi or purchase centre at a distance of 2 to 5 km,” says former Vice-Chairman of PMB, Ravinder Singh Cheema.

“It was set up to regulate the marketing of agricultural produce by eliminating malpractices prevalent in the trade in the 1950s,” said Cheema, adding that the board also set up 152 main yards, 280 sub yards and 1,436 purchase yard (total 1868 purchase points) across the state.

The PMB has also set up seven maize dryers with a total capacity of 248 tonnes per batch at a cost of Rs 55 crore at seven places across the state so that farmers can get a good price for their dry maize. Otherwise they face huge losses because of severe cuts in price in the name of high moisture content in the crop.

All these dryers are given on an annual lease of Rs 27.92 lakh.

PMB has also established 12 pack houses at a cost of Rs 13 crore, which include cold room and ripening chambers with a capacity of 950 metric tonnes (cold room) and 460 tonnes (ripening chambers). They are given on annual lease of around Rs 1.51 crore.

PMB is supposed to spend Rs 1,500 crore for various development works in 2020-21. It had provided Rs 700 crore for debt relief to farmers in March 2020. Around 4.94 lakh J-farm holders (farmers) are insured through it by depositing a premium. It paid Rs 3.65 crore in 788 cases of agriculture-related accident or deaths in the financial year of 2019-20.

Further, the PMB has over 22,000 plots, including shops, grain shops booths, etc out of which over 9,000 have already been sold to arhtiyas and traders. It has developed several vegetables and fruit markets as well.

The RDB is supposed to spend Rs 1,630 crore this financial year on various development works, including phirnis (a road encircling the village), repair of kucha houses for the poor, water supply and sanitation.

“We do not know of any place other than these mandis to sell our crops. We have no idea where we will go if the purchaser does not come to the mandis,” says farmer Nirbhair Singh, a farmer in Jalandhar grain market.

Vice-Chairman of Punjab Mandi Board Vijay Kalra says, “While the farm Acts are already in place, farmers in Punjab are still coming either to arhtiyas or to the APMC yards because they have no idea where to sell their crop.”

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