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Review of Union Budget 2004 Structural Issues Left Unaddressed - Part III One more critical issue that the FM has failed to address is the issue of market access for the poor farmer. Indian farmers' "inability to trade" has censored his "economic freedom". Disappointingly there is no mention in the budget of antediluvian, the Agricultural Produce Marketing Committee (APMC) Act. Even if the poor farmer in India say has got access to "cheap" credit, high yield variety seeds, has diversifying his production (has shifted from producing rice to mushrooms, which might fetch a very high price in the urban or big cities) but he is bound by the State to sell his produce only in the neighboring market and not even get back his capital employed. The budget should have implemented the recommendations of the reforms suggested by the inter-ministerial taskforce set up by the Ministry of Agriculture on amendments to the APMC Act and development of competitive markets and market infrastructure. No wonder, today due to lack of market access almost 40 percent of India's agricultural produce is wasted. The increased trend in production has brought in its wake new challenges to handle huge marketable surplus. A strong and robust marketing infrastructure is the core content of agricultural marketing in the country for managing marketable surplus. Also noteworthy is to find markets overseas commensurate to liberalization. The development of market access will help farmers in two ways: one to increase the market size, i.e., the increase in demand. Transfer of appropriate price signals leading to improved marketing efficiency. Government organized marketing of agriculture in the country through the network of regulated markets established under the provisions of the APMC Act enacted by the States and Union territories. Most of these markets lack requisite facilities for handling the produce arriving in the yard. Contrary to the envision, over a period of time these markets have acquired the status of institution with control and restrictions providing no help in direct marketing or retailing smooth supply of raw material to agro-processing units. Monopolistic tendencies and practices have thwarted the development of free and competitive trade in primary markets. Authored by - |
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