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The Financial Express

Giving agricultural marketing policy a chance


Giving agricultural marketing policy a chance

One wonders if the newly drafted Agricultural Marketing Policy is any different from the scores of policies that the government formulates from time to time, many of which either get shelved or are lost into oblivion due to lack of effective measures for execution. However, from reports published in the media, it seems the authorities are earnest to discipline and harmonise agricultural marketing in the country-to the benefit of both producers and consumers. The task, obviously, calls for multi-dimensional focus, and hence mere framing of a good policy serves no more than as an expression of good intent, if the required mechanism, including logistics and all related facilitating tools, are not in place. This is particularly so in respect of agricultural marketing because of the immensely vast subject that the policy aims to address-something that has never been attempted in the past.

 The draft policy received the cabinet's nod the other day. The official statement in this connection says the Agricultural Marketing Policy 2023 aims at ensuring fair prices for consumers and maximum benefits for farmers through modernisation of the market. The Cabinet Secretary while outlining a few key aspects of the policy in the Cabinet meeting chaired by the Prime Minister said the policy focuses on how the market of agricultural goods can be monitored and farmers provided with the highest benefits. "Steps will be taken to fix and implement the minimum and maximum rational prices of agricultural goods," he said, adding that a total of 19 targets have been fixed in the draft policy. The policy, he said, also speaks of enhancing links between farmers and markets, strengthening information management, improving marketing infrastructures, promoting e-agricultural marketing system and digital markets, strengthening community, group and contract-based marketing; and developing the overall supply chain. He further informed that there is also a move to formulate agricultural goods processing policy with a view to maintaining international standards of products for easing overseas market access of agro-processed goods.

 Agricultural marketing covers the services involved with moving an agricultural product from the farm to the consumer. These services involve planning, organising, directing and handling of agricultural produce in such a way as to satisfy farmers, traders and consumers. Numerous interconnected activities such as planning production, growing and harvesting, grading, packaging, transport, storage, provision for market information, distribution, and sale are involved here. Effectively, it encompasses the entire range of supply chain operations for agricultural products.

 Efforts to develop agricultural marketing, particularly in developing countries, tend to concentrate on a number of areas, specifically infrastructure development, information provision, training of farmers and traders in marketing and post-harvest issues, and support to the development of an appropriate policy environment.

 Thus agricultural marketing comprises all activities involved in the supply of inputs to the farmers and movement of agricultural products from farms to consumers.

According to experts, the system includes two major sub-systems viz., product marketing and input marketing. The product marketing sub-system includes farmers, village/primary traders, wholesalers, processors, importers, exporters, marketing cooperatives, regulated marketing committees and retailers. The input sub-system includes input manufacturers, distributors, related associations, importers, exporters and others who make available various farm production inputs to farmers.

 What is considered the key to the success of agricultural marketing system is the link it seeks to establish between the farm and non-farm sectors. A dynamic and growing agriculture sector requires fertilisers, pesticides, farm equipment, machinery, diesel, electricity, packing material and repair services which are produced and supplied by an industry and non-farm enterprises. The expansion in the size of farm output stimulates forward linkages by creating surplus produce which requires transportation, storage, processing and retailing to the consumers. These functions are performed by the non-farm enterprises. Further, if the increase in agricultural production is accompanied by a rise in real income of farm families, the demand of these families for non-farm consumer goods goes up as the proportion of income spent on non-food consumables and durables tends to rise with the increase in real per capita income. Several industries thus find new markets for their products in the farm sector.

The marketing system should be such as to bring overall welfare to all the

related segments of society-- producers, consumers, intermediaries and traders.

 The subject of agricultural marketing also includes marketing functions, agencies, channels, efficiency and costs, price spread and market integration, producer's surplus, government policy and research, farmers'/producers' training and data on agricultural commodities.

 The overall objective of agricultural marketing in a developing country like ours is to help the primary producers, viz., farmers in getting remunerative prices for their produce and creating an environment for the right type of goods at the right place and at the right price. Efficient marketing infrastructures such as wholesale, retail and assembly markets and storage facilities are essential for cost-effective marketing to minimise post-harvest losses. Markets play an important role in rural development, income generation, food security, and developing rural-market linkages.

 Clearly, marketing of agro products in the country is one of the most mismanaged areas, and accounts for unpredictable situations of sudden price hike, shortage of stock, and artificial scarcity thanks to the profiteering zeal of a section of traders. The huge gap in prices of commodities at the farmers' end and those at the ultimate consumers' end is clearly due to the manifold malpractices deeply embedded in the system.

 For the upcoming agricutural marketing policy to capture and streamline some of the basic lacunas, the authorities concerned must pay close attention to the areas critically important. If the start is satisfactory, they can then hope to move in a concerted manner to gradually make a headway in one of the most important areas of the economy left neglected for ages.

 

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