CCEA approves Rs200-cr scheme for online National Agricultural Market

The Cabinet Committee on Economic Affairs (CCEA) on Thursday approved a Rs200-crore central sector scheme for promotion of an online National Agricultural Market through creation of an Agri-Tech Infrastructure Fund (ATIF).

The Department of Agriculture and Cooperation (DAC) will set it up through the Small Farmers Agribusiness Consortium (SFAC) by creating a common electronic platform deployable in selected regulated markets across the country.  

The decision to set up an online national agriculture market by integrating 585 wholesale mandis across India coincides the announcement of a new national irrigation scheme with Rs50,000 crore expenditure.

An amount of Rs200 crore has been earmarked for the scheme from 2015-16 to 2017-18. This includes provision for supplying software free of cost by DAC to the states and union territories (UTs) and for cost of related hardware / infrastructure to be subsidised by the Government of India up to Rs30 lakh per Mandi (other than for private mandis).

The target is to cover 585 selected regulated markets across the country - 250 mandis in 2015-16; 200 mandis in 2016-17 and 135 mandis in 2017-18.

The 585 regulated markets across the country will be integrated with the common e-platform to provide farmers and traders with access to opportunities for purchase / sale of agri-commodities at optimal prices in a transparent manner. Private markets will also be allowed access to the e-platform thereby enhancing its outreach.

The scheme is applicable on all-India basis. There is no state-wise allocation under the scheme. However, states that want this would be required to meet the pre-requisites in terms of carrying out necessary agri-marketing reforms such as a single licence to be valid across the state, single point levy of market fee and provision for electronic auction as a mode for price discovery. Only those states/UTs that have completed these three pre-requisites will be eligible for assistance under the scheme.

SFAC will be the lead agency for the development of the National e-Market by the ministry of agriculture, and they will select a service provider through open bidding. An appropriate common e-market platform will be set up that would be deployable in the selected 585 regulated wholesale markets in states / UTs desirous of joining the e-platform. The SFAC will implement the national e-platform in three phases during 2015-16, 2016-17 and 2017-18.

DAC will meet expenses on software and its customisation for the states and provide it free of cost to the states and UTs.  DAC will also give grant as one time fixed cost subject to the ceiling of Rs30 lakh per mandi for related equipment / infrastructure in the 585 regulated mandis, for installation of the e-market platform.

Big private mandis will also be allowed access to the e-platform for purposes of price discovery. However they will not be supported with any funds for equipment / infrastructure.

The e-marketing platform should promote reform of the agricultural marketing sector and apart from promoting free flow of agri commodities across the country and should result in greater farmer satisfaction as prospects for marketing of his produce would be significantly enhanced.

The farmer will have improved access to market related information and better price discovery through a more efficient, transparent and competitive marketing platform, which gives him access to a greater number of buyers within the state and from outside, through transparent auction processes. It would also increase his access to markets through warehouse based sales and thus obviate the need to transport his produce to the mandi.

There are about 7,000 mandis in the country regulated under the Agricultural Produce Marketing Committee (APMC) Act. Even within in a state, farmers are restricted to sell their produce at one particular APMC mandi paying various taxes.