Although the Centre has backtracked on farm legislation that would have enabled cultivators to sell to anyone and anywhere, or enter into contracts to supply produce at pre-determined prices, and allowed traders and processors to buy, stock and move produce, the reality is that the genie of reform is out of the bottle. There is no rolling back the larger Digital India initiative pushed by the government that uses technology to transform how it delivers services to farmers. A case in point is the progress of the electronic National Agriculture Market (e-NAM), which was launched six years ago to catalyse the digital transformation of mandi or market place operations for trading of agricultural commodities. The objective was to create a transparent competitive bidding system online to enable farmers to secure remunerative prices for their produce. Around 1,000 mandis of 22 states and Union territories have so far been integrated with the e-NAM platform. Bihar and several northeastern states have yet to get on board.
As this newspaper has reported, private entities providing services such as transportation, logistics, assaying, weather forecast and fintech will be integrated into the platform to enable more farmers to sell their produce to buyers of their choice. Currently, the modalities for integration of digital platforms of the private entities on e-NAM are being worked out. The aim is to bring on board as many players so that farmers have choice on assorted agri-services after registering themselves on the portal. Once this process is completed, around 1.75 crore registered farmers—around 12% of total cultivators in the country—farmer producer organisations (FPOs), traders, commission agents and other stakeholders can avail of these services.
However, e-NAM is still some distance away from the “One Nation One Market” vision. Trade in produce is still largely intra-state as markets are highly fragmented. Inter-state trade is yet to gather momentum. Around 530-odd mandis are currently offering online trading facilities to farmers while around 97,000 unified licences valid for the state concerned have been issued to 2 lakh traders registered on e-NAM. Intra-state trade impacts price discovery although Neel Kamal Darbari, MD, Small Farmers’ Agri-Business Consortium (SFAC), which is administering this platform, told this newspaper that farmers on the platform seeing live prices prevailing elsewhere in the country helps in getting better prices. Because of small land-holdings of farmers, SFAC has also been focusing on the formation of FPOs and encouraging them to participate in e-NAM for better collective bargaining power over prices.
The upshot is that e-NAM is still a work in progress. Various suggestions in the past made by apex chambers like FICCI in a 2017 report and agricultural economists like Ashok Gulati deserve consideration. To promote trading across borders, there is definitely a warrant for a single, nationwide agricultural trading licence. More agri-market reforms are needed, starting with basics of assaying, sorting, and grading facilities for primary produce as per nationally recognised and accepted standards. Suitable infrastructure at the mandi-level (like godowns, cold storages, and driers) needs to be created to maintain those standards. A national integrated dispute resolution mechanism needs to be evolved to tackle cases where the quality of goods delivered varies from what is shown and bid for on the electronic platform. Roping in private entities definitely is a positive for enabling this digital platform to make available end-to-end services and enable efficient price discovery to give a better deal to farmers.