Ordinance To Check APMCs: Gujarat – Economics – Free PDF Download

• Recently, Gujarat’s state government has cleared the Gujarat Agricultural Produce Markets (Amendment) Ordinance 2020.

OBJECTIVE

• It has ended the monopoly of state-run Agricultural Produce Market Committees (APMCs)
• Allowed private entities to set up their own market committees or sub-market yards.

DETAILS

• The ordinance restricts the jurisdiction of APMCs to the physical boundaries of their respective marketing yards
• They can levy cess only on those transactions, happening within the boundary walls of their marketing yard.
• Earlier, an APMC had jurisdiction over an entire or more than one taluka.
• Farmers and traders of a particular taluka had to compulsorily sell their produce to their respective APMCs.
• Apart from that, APMCs levied a cess on any transaction that happened within the marketing yard of the APMC or outside it.
• The ordinance permits for setting up of private markets.
• Privately-owned old storages or warehouses can be converted into a sub-market yard or a private market that can compete with the APMCs.
• Farmers can also set up private markets themselves.
• To save the smaller APMCs from the negative competition from private markets and a fair play, the state government plans to bring a rule that will not allow the setting up of a private market within a five-kilometre radius of an existing APMC.
• Also to protect them, the government will collect 20% cess from private players and reroute 14% of it back to the APMCs.
• The ordinance provides traders with one unified single trading license through which they can participate in trading activities anywhere in the state.
• It will allow multiple traders to attract the farmers depending on the quality of their produce and offer competitive prices without the restriction of place and area jurisdiction.
• For that, amendments allow setting up of portals for e-markets.
• Expansion in Grievance Redressal:
• The director of an APMC and the Gujarat State Agriculture marketing board will also start taking care of the grievance redressal which was solely managed by the APMC till now

Expected Benefits to the Farmers

• Permission to private entities will lead to competition and will offer the best possible remuneration to farmers for their produce.
• Till now, APMCs used to form a cartel and decide on what prices to offer to farmers.
• Farmers will not be bound to sell only to one particular APMC and can choose the one with the best deal in their favour.

Viewpoint of APMCs

• APMCs have not welcomed the decision
• It ends their monopoly and allows private players to enter.
• The ordinance will also affect revenues because no cess will be collected on transactions outside the physical boundaries of marketing yards.

OBJECTIVES- APMC

• • Ensure transparency in pricing systems and transactions taking place in the market area.
  • Provide market-led extension services to farmers.
  • Ensure payment for agricultural produce sold by farmers on the same day.

• Promote agricultural processing including activities for value addition in agricultural produce.
• Setup and promote public private partnership in the management of agricultural markets, etc.

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