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Friday, July 20, 2018

Fadnavis government to extend marketing reforms to oilseeds, food grains

Submitted in July last year, the report had taken into consideration the effect of the market reforms in the fruits and vegetables markets before making its recommendations.

Written by Parthasarathi Biswas | Pune | Updated: January 10, 2018 4:45:38 am
Maharashtra govt to extend marketing reforms to oilseeds, food grains Maharashtra CM Devendra Fadnavis. (Express photo/Janak Rathod)

Allowing free trade in fruits and vegetables outside wholesale markets was one of the major marketing reforms undertaken by the Devendra Fadnavis-led government. The move, which challenged the hold of wholesale mandis over the trade was welcomed by farmers.

As the state government takes steps to extend these reforms to other commodities including oilseeds and food grains, doubts are being expressed about extending such reforms to those sectors. In fact, a report filed by the directorate of marketing goes on to say that hoarding and disruption of supplies can be a possible fallout of such a move. The report, which has been accessed by The Indian Express under RTI also talks about many pitfalls of the process, one of which would be non-conformation of the Minimum Support Price (MSP) for these commodities.

In 2016, the state government had ignored stiff opposition from traders and commission agents and gone ahead to ‘delist’ fruits and vegetables from the purview of wholesale markets. After Delhi, Maharashtra was the second state to do away with the requirement of bringing all fruits and vegetables to these markets to be sold through licensed marketing agents charging a commission. This move was widely welcomed by the farming community who had a longstanding grouse against the traders and accused them of intentionally undervaluing their produce. In the second phase of agricultural marketing reforms, the state government plans to delist oilseeds and food grains from the mandis.

The turnover of oilseeds and cereals at the over 300 mandis in the state is estimated to be over Rs 15,000 crore.

A special committee headed by minister of state for agriculture Sadashiv Khot has been formed to study the issue. The committee had asked the directorate of marketing to prepare a report weighing the pros and cons of the proposed reform. Submitted in July last year, the report had taken into consideration the effect of the market reforms in the fruits and vegetables markets before making its recommendations.

Given the mandate to weigh the pros and cons of delisting, the directorate of marketing has listed 5 positive and 7 negative results of the move. Ease of doing business, reduction in middle men, less wastage in transport and handling and a possible healthy competition between trades leading to better prices are among the advantages listed. While listing the disadvantages, the directorate noted that delisting will take away the present control over the trade which may prove counterproductive for the farmers.

“There would be no guarantee for payment to farmers and chances of farmers getting duped would rise,” the report read. Similarly, chances of disruption of the supply chain due to the hoarding and non-payment of MSP to farmers
have been listed as the negative points.

Khot, asked about the proposal, said the final meeting is scheduled for next week but refused to speculate on the possible outcome. With the trade in oilseeds and coarse grains mainly concentrated in the markets of Vidarbha and Marathwada, the mandis in those areas have already raised concerns about the move. Many say the move will virtually end their existence as majority of their income is through trade in these commodities.

Lalitbhai Shah, chairman of Latur’s market committee, talked about no guarantee to farmers if delisting was carried out. “There would be no door for farmers to knock..,” he said.

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