Karnataka, the first state to initiate reforms in agricultural commodities marketing, has refused to join the agriculture ministry-promoted national platform — electronic National Agriculture Market (eNAM) citing lack progress in allowing inter-state trade, seamless movement of goods across the country and development of uniform physical parameters for commodities trade.
A joint -venture special purpose vehicle — Rashtriya eMarket Services Private (ReMS) between the Karnataka government and NCDEX Spot, which had electronically linked the southern state’s 157 mandis, had reported a turnover of Rs 37,000 crore in 2016-17 while 244 odd mandis across 13 states linked through eNAM have so far achieved a turnover of Rs 28,250 crore since its launch in April, 2016.
Stating that Karnataka has allowed traders from at least seven states including Tamil Nadu, Andhra Pradesh, Maharashtra and Kerala to buy commodities across all the mandis linked through the Unified Market Platform, Manoj Rajan, managing director & CEO, ReMS told FE that there is no ‘reciprocity’ by other states to grant licenses to traders from outside, thus depriving the farmers from ‘real price discovery’.
ReMS provides an e-permit that facilitates the movement of commodities — pulses, oilseeds, copra, cereals within the state, replacing the manual permit system. The permit allows all 157 markets in the Karnataka to update their stock and generate e-permits from the UMP.
More than 48 lakh farmers have been registered with ReMS and their bank accounts details uploaded for ensuring prompt payment. APMCs in Karnataka charge 1.5% as mandi fee and 2% as arthia or commission agents fee for each transaction taking place in mandis from traders through ReMS while it charges 0.1% fee as transaction cost.
“There are still a lot of hurdles in the inter-state movement of agricultural commodities besides standardised physical parameters for good to be traded through eNAM is yet to be developed and primary processing at mandi level is still lacking,” Rajan said.
“As long as eNAM does not facilitate inter-state trade and buyers from one state are allowed to trade in other states We do not find any rational in joining an electronic marketing platform at this moment when a number of reforms are to be initiated before a pan Indian agriculture platform becomes a reality,” he said.
About 17 bulk institutional buyers like Cargill, ITC, Reliance, Godrej Agro and Metro Cash & Carry have registered with ReMS and assaying facilities in each of the mandi in Karnataka is being provided in a phased manner.
However, in case of eNAM, Haryana (`14,182 crore) and Telangana (Rs 7,064 crore) have two-third of the share in the total turnover of `28,000 crore so far and most of the trade of agricultural commodities is happening within mandi premises leave alone inter-state trade.
Only 52 lakh farmers — of an estimated 14 crore in the country — and 97,000 traders and 51,000 commission agents have registered with eNAM.