Delhi kicks off APMC reforms, other states stall

Written by Sandip Das | New Delhi | Updated: Sep 4 2014, 05:43am hrs
The Delhi government has removed a key hurdle that prevented farmers organisations and corporates from setting up new wholesale fruit and vegetable markets in the city, in what could pave the way for other states to do away with trade restrictions under the Agricultural Produce Market Committee (APMC) Acts, without actually having to annul these laws.

A notification issued by the Delhi government on Tuesday allowed new wholesale markets outside the purview of the existing three APMC markets at Azadpur, Keshopur and Shahdara. The notification said ...regulations of marketing of fruits and vegetables shall cease beyond the market yards of APMC Azadpur, Keshopur and Shahdara, with immediate effect.

While the Modi government wants states to delist fruits and vegetables from the ambit of APMC Acts, many states remain reluctant to do so, for political reasons.

The first to make use of the leeway would be the Small Farmers Agribusiness Consortium (SFAC), a society under the agriculture ministry. SFAC is readying to set up the first kisan mandi in the capital by November.

To sell their produce through these new mandis, the farmers wont have to pay the agents commission 6% in Delhi right now in the Delhi APMC market and the mandi tax (1%). This will help farmers get remunerative prices and bypass middlemen. Fruit and vegetable prices will as a result reduce by 20-25%. Farmers can showcase their produce in these mandis, which will be directly delivered to bulk consumers like resident welfare associations and corporate retailers and hotels.

A total of five to seven such mandis are planned in Delhi in the next two years. Of the 15,000 tonnes of supplies that Azadpur supplies to the Delhi region, the kisan mandis hope to get a market share of 5-7% soon. Around 60% of Delhis consumption comprises potatoes, onions and tomatoes.

We can now set up mandis across Delhi without getting into a legal hurdle, Parvesh Sharma, managing director, SFAC, told FE. Initially 30 farmer producer organisations would supply fruits and vegetables directly at the doorsteps of bulk buyers.

Although Azadpur handles huge volumes of fruits and vegetables daily, there is a lack of expertise in sorting the produce leading to huge wastage while due to domination of traders, price realisation is not arrived at in a transparent way, a Delhi government official said.

Sharma of SFAC said while farmers will be showcasing their produce in kisan mandis, the actual storage of fruit and vegetables would be done in various godowns located on the outskirts of Delhi. SFAC has identified a place near Alipur, north Delhi, to set up first kisan mandi.

At present more than 15,000 tonnes of fruits and vegetables are supplied across the National Capital Region through the Azadpur wholesale market and its sub-market yards.

Cumulatively, the Azadpur APMC, the biggest mandi of fruits and vegetables in the country, handles more than 40,000 tonnes of perishable agricultural commodities that is supplied to all northern Indian states.

Bypassing mandis

Till now, all fruits and vegetables have to be sold through mandis that are cartelised. UPA tried to break mandi monopolies.

Delhi govt was working on removing Azadpur the largest in India mandis monopoly.

Instead of waiting for this to happen, new notification allows new farmer mandis even as Azadpur exists.

First new kisan mandi in November, 5-7 more in Delhi in two years.