Sub-par performance

Central E-NAM law should override state marketing laws

The official data presented at a recent workshop on electronic National Agriculture Market (E-NAM) revealed that farm produce worth only about ~91,000 crore had been traded through it since its inception in 2016. This is just a minor fraction of the country’s agricultural trade and indicates an unimpressive showing of this highly vaunted agri-marketing initiative. Though E-NAM links as many as 585 mandis operated by the Agricultural Produce Marketing Committees (APMCS) in 16 states, just about 14 per cent of farmers in the country are registered with it to sell their produce. What is worse, most of the business transacted through this portal comprises the deals within the same mandi or the mandis in the same state. Instances have also come to light where the business is conducted as usual but the data is uploaded on E-NAM’S portal at the end of the day. Inter-state dealings, for which E-NAM was primarily set up, have been very few — totalling just 136 till now. Most of these transactions, too, have been between the adjoining states like Telangana and Andhra Pradesh, and Uttarakhand and Uttar Pradesh. Only 21 mandis in eight states have so far acquired the facilities needed for interstate trade in farm goods.

Thus, E-NAM has so far failed to serve its prime objective of letting the farmers sell their produce in the country to any buyer who offers the best price. The reasons for the sub-par performance are many and fairly apparent too. Most of the essential preconditions for the success of a seamless common agricultural market for the country as a whole have yet to be fulfilled. These include a single trading licence valid across the country; uniform mandi levies in all states payable at a single point; hassle-free inter-state movements of traded goods; standardised quality parameters for agri-commodities; and credible assaying facilities in all the participating mandis.

The Small Farmers’ Agribusiness Consortium, which oversees the functioning of E-NAM, has recently introduced several novel features to woo traders and farmers, particularly the Farmers Producers Organisations (FPOS). These include farm-gate and warehouse-based trading for the farmers and FPOS and the systems like shopping carts, bunching of invoices and part-payment facilities for the convenience of traders. However, these amenities and services are also likely to end up facilitating only intra-state, not inter-state, business unless the farm marketing laws of states are aligned with the model APMC legislation drafted by the Centre. This requires cooperation from the states, which is not forthcoming in full measures. Though many states have amended their APMC Acts, most of the modified statutes are not strictly on the lines suggested by the Centre through the model Bill. If the government is serious about the success of E-NAM — which it should be, given the benefits of a wider market for the farmers — it should consider the idea mooted in the Economic Survey (2014-15) to enact Central E-NAM legislation overriding the state marketing laws. This is allowed under List III of the Seventh Schedule (Concurrent List) of the Indian Constitution. The state laws could continue to govern spot physical trading at the local level. No doubt, the states would resist such a move, but there seems hardly any alternative to it.