Over 3 lakh farmers are getting better prices

Written by Sandip Das | Updated: Jun 19 2013, 08:33am hrs
Earlier this year, Small Farmers Agribusiness Consortium (SFAC) appointed National Spot Exchange (NSEL), promoted by a consortium of firms including Financial Technologies, as the technical and logistics supply agency for carrying out procurement of pulses. Anjani Sinha, managing director and CEO, NSEL, spoke to FEs Sandip Das on the impact of the tie-up on farmers.

What benefits are the farmers going to get from your tie-up with SFAC

SFAC is a nodal agency appointed by the government, designated for conducting minimum support price (MSP) procurement of oilseeds and pulses. SFAC is empowered to procure these commodities from farmers through the network of farmer producers organisations (FPOs).

The consortium has appointed NSEL, after several rounds of competitive technical and financial bidding, for carrying out procurement operations in states where the FPO network is active. Under this arrangement, we are opening procurement centres with the assistance of local FPOs. Farmers bring their produce at these centres and our staff carries out quality-testing and weighing goods. If the quality conforms to prescribed standards, it is accepted and a receipt is issued. The farmer is also required to submit documents, such as bank account details, copy of land records, etc. to establish that he is a farmer and not a trader. After verification, we issue a bankers cheque in his name. Subsequently, the stock so procured is shifted to the designated warehouse of SFAC.

As NSEL is present in 17 states with adequate manpower and technical know- how, it is able to scale up operations by opening several centres. Hence, the tie-up enables a large number of small farmers to avail benefits of MSP procurement.

What are the key challenges in implementing this initiative

Farmers are not aware of the quality specification norms. It needs lot of handholding to educate them about these things. For this, we have made special arrangements at our procurement centres to clean, sieve, etc, so that the farm produce can match the prescribed standards. In remote areas, the availability of trained manpower is also an issue. In order to solve this, we are initiating a training programme for local FPOs so that they can carry out such activities. We are confident this initiative will go a long way in helping small and marginal farmers market their produce.

Is this alliance confined only to government procurement, or does it lend greater marketing support to farmers

In fact, the arrangement between SFAC and us covers alround marketing support for FPOs and their members. The procurement through the MSP mechanism is only a part of it. If an FPO observes that its farmer members are not being remunerated properly in the local market, it can approach us directly to get its support for finding buyers who can offer a better price. In such a case, NSEL will conduct warehouse receipt- based e-auction to find buyers and the commodity will be sold to the buyer offering the highest price. We will provide logistical support, wherever required, for delivery of goods.

How many farmers have been connected with this tie-up

The consortium is promoting a large number of FPOs across the country. There are more than three lakh farmers currently connected with these organisations and the number is growing every day. All such farmers will be able to get the benefit of institutional support provided by us.