To ensure that a large part of the retail prices of key vegetables are realised by farmers, the government will reimburse transportation costs of tomato, onion and potato (TOP) to state government agencies and co-operatives. This will reduce the role of private intermediaries who jack up costs, causing retail prices to spiral, without any commensurate benefits for farmers.
Under the market intervention scheme (MIS) of agriculture ministry, the proposal is to pay the transportation cost for TOP to the a larger number of state agencies including multi-state cooperatives, state agencies Nafed, National Cooperative Consumers Federation of India (NCCF).
Sources said the proposal to reimburse transportation cost to the state agencies has been cleared by committee of secretaries (CoS), and will now be placed for approval of committee of ministers (CoM) of essential commodities.
Under the earlier norm of MIS, where there is a huge difference in prices of TOP between the producing and consuming states, the operational cost incurred in storage and transportation of crops from producing states was being reimbursed to only Nafed and NCCF.
However with the revised norms, multi-state cooperatives and designated agencies in states and other central agencies would be covered.
Sources said the proposal to reimburse transportation cost to these agencies has been cleared by committee of secretaries (CoS), and will now be placed for approval of committee of ministers (CoM) of essential commodities. The quantum of reimbursement of transportation cost for the TOP will be decided by the case-to-case basis.
Agriculture minister Shivraj Singh Chouhan recently stated that this initiative would enable farmers to directly sell their produce to consumers, reducing the role of intermediaries and ensuring maximum profit for farmers. Such a scheme would help reduce “wide variations in prices” at the production and consumption points, he had stated.
Chouhan had earlier stated that farmers cannot bear transport costs and take their produce to large markets in Delhi, Mumbai, Chennai, or Kolkata, so they sell cheaply at the farm gate or nearby mandis.
In view of sharp fall in tomato prices, the government last week announced that it will reimburse the storage and transportation cost of tomato in Madhya Pradesh under the MIS to NCCF.
MIS is component of Pradhan Mantri Annadata Aay Sanrakshan Abhiyan (PM – AASHA), which aims at procurement operations of commodities pulses, oilseeds and vegetables that would not only help in providing remunerative prices to the farmers for their produce but also control the price volatility of essential commodities by ensuring their availability at affordable prices to consumers.
MIS comes into operation when there is a minimum reduction of 10% in the prevailing market price as compared to the previous normal year.