Plan panel asks states to speed up market reforms

NEW DELHI: The Planning Commission has said that states would have to amend the Agricultural Produce Marketing Committee (APMC) Acts as a means to reform markets and give fillip to contract farming. The Act prescribes that agriculture produce can be bought in regulated markets. This stipulation acts as an impediment for creation of a common market for agriculture produce.

The commission has also said that the Essential Commodities Act too would have to be amended to allow development of trade in agricultural products. Aspects of the Act that discourage development of modern private trade should be removed and those which enable intervention in emergency and scarcity strengthened, it said.

In the draft mid-term appraisal of the Tenth Plan that would be put up for the consideration of full Planning Commission chaired by PM Manmohan Singh next week, the commission has said: “Contract farming needs to be supported by changes in the Agricultural Produce Marketing Committee Acts. The changes must be made in the interest of the farmer.�

Several states have in the past agreed to amend their APMC Acts in line with a model Act drafted by the Centre. But due to stiff resistance from interest groups that control the mandis, states have been able to do little on this count.

Making a strong case for encouraging contract farming, the Commission has said that central assistance in the proposed horticulture mission should be linked to agricultural marketing reforms, especially amendments in (APMC) Acts.

The planners reckon that contract farming will enable corporate buyers to organise groups of farmers to produce under contract, with the buyer organising the supply of seeds and related inputs, and also providing extension support.

The draft MTA states that agricultural diversification needs to be supported by the evolution of infrastructure such as development of cold chain with facilities for quick refrigeration shortly after harvesting and transportation to the market in refrigerated trucks.