27th September, 2002
Ministry of Agriculture  



Union Agriculture Minister, Shri Ajit Singh, chaired a Conference of the State Ministers on Agricultural Marketing Reforms here today. In the Conference, issues relating to legal reforms for promotion of competitive agricultural markets, direct marketing and contract farming programmes, rationalization of market fee structure, pledge financing and warehousing receipt system came up for discussion. All the States were of the view that reforms in the agricultural marketing sector were necessary to move away from a regime of controls to one of regulation and competition. The existing set up of market yards had failed to secure to the farmers competitive prices for their produce. The emphasis was more on regulation and collection of revenue and not the provision of requisite facilities. In view of liberalization of trade and emergence of global markets, it was necessary to promote development of a competitive marketing infrastructure in the country. While promoting the alternative marketing structure, however, Government need to put in place adequate safeguards to avoid any exploitation of farmers by the private trade and industries.

In order to integrate farm production with national and global markets, many States considered it necessary to promote direct marketing and contract farming programmes and to bring about professionalism in the management of existing market yards and market fee structure.

To avoid distress sales by farmers, all the States agreed that there was a necessity to substantially step up pledge financing and also the need to introduce negotiable warehousing receipt system for agricultural commodities. The Reserve Bank of India needs to evolve simple guidelines in this regard. State Governments also expressed the need for providing adequate banking facilities and credit to support farmers as well as the agro-processing industries in marketing of agricultural produce.

The States while appreciating the newly implemented Central Schemes on ‘Cold Storage’ and ‘Rural Godown’, requested for further expansion of these schemes during the Xth Plan period. The States also requested the Central Government to announce a similar Scheme to promote investments in the construction of new agricultural markets and for strengthening and modernization of existing markets.

At the conclusion, Government decided to set up a Task Force under the Chairmanship of Minister of State for Agriculture with State Ministers In-charge of Agricultural Marketing from select States to suggest legal, policy and financial measures to accelerate implementation of reform measures in the agricultural marketing sector, including a model law for the modern competitive agricultural markets.

Shri Hukumdeo Narayan Yadav, Minister of State for Agriculture, State Ministers, Lt. Governor and Administrators of Union Territory Administration and Senior Officials from Government of India and State Governments participated in this Conference.