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The Centre has advised States to amend the existing APMC Act to allow direct marketing and contract farming and permit setting up of competitive market in private and cooperatives sectors.
Under the present Act, the processing industry cannot buy directly from farmers. The farmer also is restricted from entering into direct contract with any manufacturer because the produce is required to be canalised through regulated markets. These restrictions are acting as a disincentive to farmers, trade and industries.
The Government has recently approved a central sector scheme titled ‘Development/Strengthening of Agricultural Marketing Infrastructure, Grading and Standardization’. Under the scheme, credit linked investment subsidy shall be provided on the capital cost of general or commodity specific infrastructure for marketing of agricultural commodities and for strengthening and modernization of existing agricultural markets, wholesale, rural periodic or in tribal areas. The scheme is linked to reforms in State law dealing with agricultural markets (APMC Act), assistance under the new Scheme will be provided in those States that amend the APMC Act.
Giving this information in reply to a question in the Rajya Sabha today, Minister of State for Agriculture Shri Kanti Lal Bhuria informed that the Scheme was approved by the Government on 20.10.2004. All the States have since been requested to inform as to whether necessary amendments to APMC Act have been carried out, in order to notify the reforming States for applicability of the Scheme. Reply from the States is awaited. As such, no assistance under the Scheme has been provided to States so far.
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