Agricultural produce market committee (APMC) Karnataka

To implement market reforms bringing in efficiency and transparency in the agricultural marketing system for efficient price discovery to benefit farmers and other market participants by using cutting edge technology and be constantly adapting the best practices. Better price realization for agricultural commodities is a strong incentive for the farmers to produce more. The objective is to assure competitive price for the farmers’ produce in the markets through Agricultural Produce Market Committees (APMCs). The farmer would be able to make an informed decision about selling if he knows the trends in the futures market. These trading can be located at the mandi, warehouse and/or private markets.

Problem Description:

In current APMC system farmers are forced to pay commission, marketing fee, APMC cess etc which pushes up costs. Monopoly of any trade (barring few exceptions) is bad, whether it is by some MNC corporation by government and here by APMC. It creates an artificial barrier & deprives farmers from having better customers, and consumers from original suppliers.
In addition, member and chairman are nominated/ elected out of the agent operating in that market. Politics plays a large role and despite inefficiency they won’t let go any control. Agents have tendency to block a part of payment for unexplained or fictitious reasons to farmers. In several instances, Farmers are refused payment slip (acknowledging sale & therefore payment). Farmers require these payment slips to get loan from Banks. Hence they are forced to go to private money lenders, who work in unison with the agents or political bosses.
Another such instance sale through manual tender system, sometimes the arrivals of commodities in the markets are so huge that it takes up to evening or night to complete the process of trade. There are also possibilities of error while entering the rates in tender slips. Moreover, farmers have to wait for a long period especially during heavy arrival period, due to delay in completion of trade transactions. To overcome these problems, Electronic Tender System of sale was introduced.

Solution:

By introducing unified market platform for which touch screen kiosk at market gates, Farmers bring their produce for sale at the market yards through different means like trucks, carts, tractors etc.
At the market gate details of the commodities including the name of the farmer, his address, name of the commodity, approximate quantity, name of the commission agent or trader’s shop where the commodity will be displayed for sale are records are inserted into the application through kiosk.
Each commodity is given an identity and the gate pass is given to the farmer. Thereafter the farmer takes the commodity to the commission agent or trader’s shop. The licensed traders who are interested in buying the commodity are given a unique code number.
The interested trader inspects the commodities displayed at the yard and quotes his best price through the electronic system he is having at his shop or through kiosks that are established in different places in the yard.
In this way rates quoted by different traders for different commodities are collected at the central server located in the APMC office which is available to view through electronic systems The information is taken and circulated among all the farmers and traders and is also displayed at information kiosk or by giving print out.

Benifits:

The electronic system has brought transparency and confidence among the stakeholders in the system of sale. It has helped farmers to get competitive price for their produce. A study of 9 markets and 21 commodities has revealed that there has been an increase 20 percent in the arrivals of commodities and the farmers are able to get an increase in prices for their commodities ranging from 4% to 50%. Further, there is a saving of time in completion of the process from 1 to 3 hours. The project has brought in accuracy in the system and removed the errors and mistakes in the prices quoted.
It has helped collection and maintenance of correct information of prices and arrivals of commodities and timely dissemination of such information. The Department has also realized increased income by the way of market fee without evasions. The system brought marketing reforms in the state, and behavioral changes among the farmers and market stakeholders by adopting modern technology.