Agricultural Produce Market Committee (APMC) Act in Uttarakhand and its Impact on Agribusiness Dr. Siba Sankar Mohanty* Atul Singh** ABSTRACT [Lack of. Read more about APMC Act comes into effect in Uttarakhand on Business Standard. With Governor Margaret Alva giving her assent, the. Read more about Uttarakhand cabinet approves APMC Act on Business Standard. The Uttarakhand cabinet has given its seal of approval to.
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Skip to main content. Log In Sign Up. Following the guidelines of the model national Agricultural Produce Marketing Committee APMC Act ofUttarakhand also adopted the Act in the year with a hope that the Act would streamline the marketing possibilities for farmers and the sector would flourish with new investments pouring in through increased private participation.
The present article, with an attempt to review the performance of the Act in the state of Uttarakhand, highlights that not only the Act has failed in improving the marketing opportunities for the agricultural sector, it has in reality squeezed the market for the common producers due to inordinate delays in institutionalizing the Act and other factors related to governance of the Act] [Keywords: The present article substantially draws on a GIZ sponsored study on the same topic and the authors are indebted for the financial support extended by GIZ for completion of the study.
International Journal of Marketing and Technology http: The stagnation in the countryside might have been the primary reason for rampant outmigration1 from the state compared to Chhatishgarh and Jharkhand Singh, Being a mountainous state, the scope of spatial expansion in the sector agriculture was never a rational proposition.
So, most policy circles including the corporate lobbies2 have been advocating for possibilities of value addition, improvements in postharvest management and adequate marketing facilities in the state3. In its memorandum submitted on 5th June to Shri B. However, the preparations had started much earlier. In the year itself, chief minister had handed over the model Act to a subcommittee that visited several states including Andhra Pradesh to study the prospects of the Act.
It was expected that soon after the enactment in the state assembly, there would be a remarkable change in the scenario of agricultural marketing in the state Prashant, The optimism was evident from the remarks of the agriculture secretary Mr.
APMC Act comes into effect in Uttarakhand
Om Prakash to the media, “through the new Act, the government would open doors for private investors like Reliance Industries and ITC which have recently entered the agriculture sector in a big way. We have done our job; it is now for the private players to take benefit of apnc proposed act”6. The present paper is an attempt to highlight an assessment of the impact of the APMC Act on the growth of agri-business in the state after three years of its implementation.
The study also attempted to highlight the concerns, bottlenecks and the hurdles that have restricted the scope of the Act in the state and made some policy recommendations for the effective implementations of the Act. Since the Act was supposed to build an ambience of market promotion for aact agricultural produce, it was expected to have a bearing on the size of the market, exports of agro produce, growth of agro processing centres, growth in capital formation in the sector and private investment in the sector, growth in the institutional infrastructure and price support for the farmers after the implementation of the Act.
In order to study the investment scenario and the growth in agri processing units, we have referred to budget documents of the state government,Annual Survey of Industries ASIand the information from District Industries Centre DICDirectorate of Economics and Statistics DES and the annual reports of various other agencies.
In some specific cases, in order to study the impact of the Act on price and arrival, we have used dummy variable based univariate analysis to assess the differences before and after the implementation of the Act.
The major findings are summarised in the sections below. Since the scheme is a demand driven one, this may clearly indicate apathy from the side of state government to demand for and utilize funds to develop infrastructure towards agricultural marketing and such other facilities in the state. These include horticulture crops, medicinal plants and herbs, litchi and basmati rice. The volume of exports of litchi after was less than the volume in Even the unit price of exported litchi was lower in than in The total area under fruit, vegetables and spices and their output in the country increased significantly.
But in Uttarakhand, except for spices, in other horticultural crops there was no significant change in the area under horticultural production. Again, in spices, although there is an increase in the area under crops, there hardly was any impact on the production and in fact the yield rate, although placed at a much higher level than the Indian average, declined in the state.
Even after implementation of APMC Act, there hardly was any progress in creation of new export oriented units in the state. As per the reports of the Ministry of Commerce, there were only three formally approved exports oriented SEZs and two notified SEZs in Uttarakhand compared to formally approves and notified SEZs in the country as on 31 December After two years, as on 11 Februarythere were formally approved and notified SEZs in the country.
But in Uttarakhand, there were only two formally approved and only one notified SEZs on 11 February So, on many counts, the performance of the state as far as agricultural export is concerned has deteriorated in the state of Uttarakhand after implementation of the Act.
Investment in Agriculture in Uttarakhand In a state lacking basic marketing infrastructure, it is presumably expected that in order to promote private investment, the initiative should be taken by the government.
Such initiative may not be limited only to formulation uttarqkhand an Act for market promotion. In Uttarakhand, there hardly were any effort by the government to promote investment in the state.
As evident from the figures of the State Budget Documents, there has not only been a low priority of the state for investment in agriculture, the investment efforts from the government have also declined in the post APMC years.
NAM: 17 states have modified their APMC Act -Governance Now
Here, we have considered only the planned expenditure of the government of Uttarakhand both in Revenue Account and Capital Account Table-2 and Table In the recent budget, the government scaled down most of its activities in the sector except for agricultural research and education. Rather, we can see a similar trend in the private investment as well. On the basis of the employment figures and capital use data provided by the Directorate of Industries in Uttarakhand, we can easily see that there has been deterioration in the growth of enterprises in the sector, especially after the implementation of the APMC Act.
In many districts, there has been a decline in the number of enterprises associated with agriculture. Capital use includes land and machinery Source: After the implementation of the Act in Uttarakhand, different Mandi Parishads were constituted under different classes. Our study suggests that in several districts of the state mainly in the mountainous regions, the market committees are yet to be functional. One of the main concerns is therefore the failure to initiate the first task of identifying and forming market committees in all the districts of the state.
Districts like Uttarkashi, Chamoli, Rudraprayag, Pithoragarh and Almora are probably those districts that seriously lack adequate market infrastructure and facing serious problems of outmigration and other issues that have a lot of linkages with the performance of the agricultural sector in those districts. It is evident from the analysis of information on commodity arrival and price of commodities traded in these markets. We studies the impact of APMC Act on the daily arrival of three commodities widely traded in some major mandies of Uttarakhand for which data is available from Directorate of Marketing and inspection, Ministry of Agriculture, Government of India.
Results are presented in Table-4 through Table-6 The results show that in case of apple, there was a steep decline in the daily arrival data in case of Haldwani and in all other markets the daily arrival of the crop actually did not change much. Out of three markets analysed for apple, while in kichha, there was a marginal increase in the average daily arrival of the fruit in post APMC phase, there was substantial decline in Haldwani mandi and all the three mandies taken together.
One of the preconditions for a successful market infrastructure is probably its ability to ensure a remunerative price for the producers, in this case the farmers.
Therefore, it was expected that the APMCs should have provided better prices to the farmers. Again, better prices are not necessarily higher prices only, but prices that would motivate farmers to produce more and sell more in the specific markets.
Our analysis suggests that except Haldwani mandi, price of the commodity on a trading day had hardly any role in determining the amount of arrival of the products in the next trading day.
In some cases we found that even a higher price in the previous day adversely affected the arrival amount of apple in the mandi. In case of tomato, except for Khateema and Kashipur in all other cases, we found that the functioning of APMCs might have had undesired effects on arrivals. Our observation from the discussions with the farmers and traders in Rishikesh and Haldwani mandies suggest that the committee members do not enjoy sufficient trust of the traders.
We also observed during our visit to mandi samities that the members of the samities were often missing in their offices and were busy in political activities related to their respective parties. Wherever we were able to meet the members of the mandi samities, most of them were not aware about the Act and its mandates. Second, institutional bottlenecks need to be strengthened urgently. The state government should make all efforts to expand the scope of the Act in all the mountainous districts.
Third, implementation of APMC Act in isolation cannot improve the lots of agriculture dependent population in the state. It has to be backed by adequate infrastructural support from the government in the form of necessary extension services and other support systems. Fourth, it is observed that the private investment in the state is not forthcoming in the agricultural sector although there have been success stories mostly located in the plain districts.
Efforts for farm mechanization in the plain districts have been satisfactory, but in the hill districts efforts for crop diversification, the provision of extension services and value addition have largely failed. A mountain focus is clearly missing in the agricultural policies of the government. Fifth, the existing mandi samities need to be revamped and efforts should be taken for some trust building measures among farmers on mandi samiti members.
Some monitoring mechanisms should be in place for smooth functioning of the mandies. Finally, the budgetary provisions for capital investment in the sector should be enhanced. Investment in a critical sector like agriculture that still remains the life line of a majority of the workforce in uttarakyand state cannot be left to be addressed by the private sector only.
Unless these issues are addressed, the potential benefits of the Act towards making markets work for the farmers would remain unrealized. Debate on Development URL: Uttarskhand model APMC Act served as a guideline to formulate State Acts with provisions for direct marketing, contract farming in partnership with private and co-operative sector.
An Overview, Viewed on 2 December http: Debate on Development ,Viewed on 17 Novemberhttp: Remember me on this computer.
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