NATIONAL POLICY FRAMEWORK ON AGRICULTURAL MARKETING

Acronyms and Abbreviations

A list of acronyms and abbreviations used in the policy framework is provided.
Examples include APMC (Agricultural Produce Market Committee), AVC (Agri. Value Chain),
CF (Contract Farming), DA&FW (Department of Agriculture & Farmers' Welfare), eNAM
(Electronic National Agricultural Market), EoDA (Ease of Doing Agritrade), FPO (Farmer
Producer Organisation), IGAC (Infrastructure Gap Analysis Committee), PMFBY (Pradhan
Mantri Fasal Bima Yojana), PMY (Principal Market-Yard), SAMB (State Agricultural
Marketing Board), SMY (Sub-Market Yard), and ZBNF (Zero Budget Natural Farming).

Chapter 1: Introduction
India's agriculture sector has shown its best performance in terms of growth recently.
Critical areas for improving farmers' income with transparency and ease include public
infrastructure like block-chain technology, use of innovations, capacity building through
proper skilling, and professionalism.
The policy identifies both areas of satisfaction and areas needing improvement, along with
modalities for potential uniform improvement.

Chapter 4: Market Architecture in the Country and Policy Intervention

4.1 Situational Analysis:
4.1.1 Regulated wholesale markets:-
Organised wholesale marketing uses regulated markets established under APMC Acts of
States and UTs.
As of 31.03.2024, there are 7057 regulated markets (2605 PMYs and 4452 SMYs).
APMC Acts are enacted in 27 States and 3 UTs, but not yet implemented in 3 North-Eastern
Region (NER) states despite enactment.
Market density varies significantly between states.
The country's average regulated market serves 407 sq km area, against the norm of 80 sq
km recommended by NCF, 2006. This highlights a significant gap in market density.
More than 1100 markets are non-functional.
In many states, market committees are notified (around 450), but market yards are not yet
established, or notified markets lack any infrastructure.
Market density is crucial for providing markets closer to farmers' locations.
4.1.2 Unregulated wholesale markets:
There is no authentic data regarding the number of unregulated wholesale markets.
4.1.4 Grameen Haats:
Grameen haats (rural periodic markets) are significant for agriculture and allied sector
marketing, offering potential for future development.
Developing these haats into Grameen Agricultural Markets (GrAMs), as recommended by
the Doubling Farmers' Income report and announced in the 2018-19 Union budget, could
provide one-stop marketing solutions closer to the farm gate.
4.1.5 Private wholesale markets:
There are about 125 wholesale private markets in the country.
4.1.6 Farmer-Consumer Markets:
Mentioned within the section on Grameen Haats. No further details or situational analysis is
provided in this section.
4.1.7 Trading through e-platforms
Agricultural produce is increasingly traded through electronic platforms.
This includes electronic commodity exchanges regulated by SEBI and the eNAM platform.
4.1.7.2 eNAM:eNAM was launched in 2016 with the aim of developing a unified national
market for agriculture produce, allowing buyers across the country to bid online for produce
located anywhere.
The goal was for farmers to get the best price discovered transparently and competitively,
and for distant buyers to purchase desired quantity and quality online.
Developing state-level markets (inter-mandi trade) and unified national markets (inter-state
trade) through eNAM has faced operational, legal, infrastructural, and financial challenges
that need addressing.

4.2 Policy Interventions:

DA&FW will work to improve farmers' access to markets and increase market density.
DA&FW will engage with states to redefine market density needs based on geographical
area, production, marketable surplus, and transport infrastructure, aiming for the norm of one
market per 80 sq km recommended by NCF, 2004.
States are encouraged to formulate their own state-level policies on agricultural marketing,
ideally in consonance with the national framework, to achieve the goal of "Best Possible
Market and Price" for farmers.
Assess state/UT-wise marketing and auxiliary infrastructure gaps, potentially at the district
level, and work to bridge these gaps.
Promote the development of multiple marketing channels with public and private sector
involvement to enhance efficiency and competition. This requires reforms in agricultural
marketing laws and policies.
DA&FW and states will study private physical wholesale markets and private e-trading
platforms to assess their operation, business viability, and farmer benefits.
Aim to strengthen/develop 300 grameen haats into GrAMs annually, with 50 in NER and hilly
states and 250 in other areas.
Engage with the Department of Economic Affairs, SEBI, and Commodity Exchanges for
regular policy on futures trade and integration of FPOs with futures platforms.
Integrate more markets, including collection centres, private markets, deemed markets
(warehouses/silos/cold storages), GrAMs, and FPO premises, with the eNAM portal.

Chapter 5: Strengthening and Modernization of Agri Value Chain and Marketing

Infrastructure and Policy Intervention
5.1 Situational Analysis:
Infrastructure and facilities in APMC markets are quite inadequate in most cases.
Some notified markets exist solely for the collection of market fees and lack any
infrastructure.
Post-harvest management and marketing infrastructure are generally lacking or inadequate.
There's a need for high-precision infrastructure at district/regional levels focused on
processing and export, including cold chains, value addition, pack-houses, quality labs,
labelling, and branding.
5.2 Policy Interventions:
DA&FW aims to facilitate digital transformation of output marketing and value chain
infrastructure, promoting 'ease of doing agri-trade'.
Develop a Digital Marketing Portal (DMP), an improvised version of e-NAM, based on the
principle of "plug-in-plug out" with other public and private digital infrastructures (DIs) for
services like e-trading, quality assaying, packaging, logistics, and finance.
Integrate technologies emerging from Agri Start-ups and food safety initiatives into the DMP.
States may constitute an Infrastructure Gap Analysis Committee (IGAC) at the state level,
potentially with professional and central government involvement, to assess gaps in both
physical/non-digital and digital output/value chain infrastructure.
Based on gap analysis and functional requirements, DA&FW may formulate a scheme in
consultation with states and stakeholders. Existing central and state schemes need to be
better popularised.

Chapter 6: Professionalism of APMCs and their Orientation Towards New Dynamics of

Markets and Policy Intervention
6.1 Situational Analysis:
APMCs are statutory bodies primarily engaged in enforcing APMC Act/rules and collecting
market fees.
In the changing scenario, APMCs need to become professional and service-oriented,
promoting value chain-based marketing.
Inadequate infrastructure and facilities for cleaning, grading, sorting, packaging, and food
processing exist in most APMC markets.
There is a need to develop infrastructure for primary value addition in market yards,
potentially through PPP mode.
Developing the food processing sector within market yards is crucial for reducing
post-harvest losses, increasing shelf-life, and tackling issues like rural unemployment,
poverty, food security, inflation, nutrition, and waste prevention.
Commodity-specific markets exist but need focus on emerging areas like millets and
organic/natural farming produce.
Cultivators of organic and natural farming produce face issues with certification and finding
markets.
Consumers are willing to buy quality and safe produce, but its availability and credibility
deter them. Dedicated markets and infrastructure are needed.
6.2 Policy Interventions:
States should endeavour to provide niche/dedicated spots in potential APMC markets for
organic and natural farming produce, providing necessary infrastructure.
APMCs need to shift from merely collecting fees to being service providers for agri-value
chain services.
APMCs should aim to develop infrastructure/facilities for quality assaying, cleaning, sorting,
grading, value addition/processing, etc., possibly in PPP mode.
States should identify potential APMCs to develop into export markets, equipping them with
commodity-specific infrastructure needed for making produce exportable. DA&FW may
provide technical and financial support.
Secretaries and technical staff of market committees require professional training and
acumen to handle value chain services. States should recruit qualified personnel and
provide training.
Chapter 7: Development of a Competitive, Transparent and Efficient Marketing Ecosystem
with Focus to Develop Unified National Market and Policy Intervention
7.1 Situational Analysis:
Agricultural marketing regulation is evolving to meet the needs of market participants,
especially farmers.
The goal is to enable farmers to sell through multiple channels (APMC mandi, private
market, direct marketing, online platforms, exchanges) to any buyer offering the best bid.
Applying digital technology is critical for improving transparency and price discovery. This
requires reforms in state agricultural marketing laws and policies.
Reform initiatives started seriously in 2003 with the Model APMC Act, followed by
continuous engagement and the more liberal Model Act of 2017.
7.1.3 Recently, DA&FW has identified following 12 areas of reforms
DA&FW has identified 12 areas for states to make enabling provisions in their APMC Acts
and implement them on the ground to make markets accessible, competitive, and
transparent.
1. Allowing setting up of private wholesale markets: Required to create competition with
APMCs and other channels, improving farmer-market linkages. As of the data, 26 states/UTs
have adopted the provision in the Act, but only 15 have notified the rules.
2. Direct Marketing (wholesale purchase from farm gate outside the market-yard): Allows
buyers to purchase directly from farmers outside the mandi. Mentioned as happening but not
at the required scale. Status not explicitly shown in the adoption table, but implied to be
adopted by several states under general reforms.
3. Declaring warehouses/silos/cold storages as deemed market-yard: This reform offers
multiple benefits, including better market accessibility, addressing distress sale, availing
pledge finance, and developing competitive online marketing. Enabling provisions are made
in most states, but rules are notified in only a few (Andhra Pradesh, Telangana, Karnataka,
Uttar Pradesh). Non-restrictive, business-oriented rules are needed.
4. Allowing setting up of private e-trading platforms: Crucial for competitive online marketing.
Only limited states allow this in their Acts. Urgent provision and non-restrictive, uniform rules
are needed. Status not explicitly shown in the adoption table.
5. Single time levy of market fees across the state: Ensures fees are charged only once for a
transaction within the state. Adopted by 27 states/UTs, with 19 having notified rules.
Exceptions are NCT of Delhi and Puducherry where it has not been adopted.
6. Single unified trading licence valid across the state: Allows traders to operate throughout
the state with one license. Adopted by 27 states/UTs, with 19 having notified rules.
7. Rationalization of market fee: Adjusting market fees to be reasonable. Adopted by 25
states/UTs.
8. Rationalization of Commission charges: Adjusting commission fees. Adopted by 24
states/UTs.
9. Reciprocity of trading licence: Allowing trading licenses from other states to be valid.
Enabling provision adopted by only 9 states, and none have notified rules or entered MOUs.
This reform is yet to be grounded.
10. De-regulation of perishables outside the market yard: Removing regulation for perishable
goods like fruits and vegetables outside the APMC market yard. Adopted by 21 states/UTs.
Most states have taken initiatives, but unevenly.
11. Exemption of market fee on direct sale by farmers/FPOs at processing units/factories:
Aims to boost processing and exports, improve farmer income, and create employment.
Only 5 states/UTs have adopted this.
12. Exemption of market fee on produce brought from other state for processing: Also aims
to boost processing and exports. 11 states/UTs have adopted this.
A table details the adoption status of these 12 reforms by states/UTs.
7.1.4 Development of Unified National Market for Agricultural Produce:-
State-legislated APMC Acts fragment the market within the state.
Developing even a state-level unified market is a challenge.
Various reports have long recommended developing a national level "Unified Market" for
seamless trade and improved marketing efficiency.
DA&FW's initiatives, like eNAM, aim for a unified market.
Challenges in developing a state-level market through inter-mandi trade and a national
market through inter-state trade are operational, legal, infrastructural, and financial.
7.2 Policy Interventions:
Progress on agricultural marketing reforms and developing a unified national market has not
been satisfactory.
Pitfalls include state-specific stringent regulations and lack of passion to achieve the
objective.
There is a need to develop consensus among states and increase willingness to implement
reforms.
DA&FW and states may constitute an "Empowered Agricultural Marketing Reform
Committee of State Agricultural Marketing Ministers" (on the lines of the GST committee) to
push states to adopt reforms, notify rules, and build consensus for a unified national market
through single licensing/registration and single fee.
This Empowered Committee may consider suggesting a national law for agricultural
marketing and uniform market fees.
An Executive Committee under the Empowered Committee, chaired by Addl. Secretary
(Marketing), DA&FW, with state Principal Secretaries/Secretaries as members, will prepare
background work, monitor progress, and review reforms and unified market development.
DA&FW will develop a new reform indexing table, including implementation aspects, to
create healthy competition among states for adopting reforms uniformly. The table will be
regularly updated and circulated.
The Union Agriculture Minister will honour top states based on this indexing table.
Here are detailed notes from the specified chapters of the Draft National Policy Framework
on Agricultural Marketing, drawing on the provided sources:

Chapter 8: Ease of Doing Agritrade (EoDA)

8.1 Situational Analysis:Agricultural marketing in the country is undergoing various reforms

aimed at improving the overall agritrade climate.
Ease of doing agritrade is crucial as marketing is no longer just a trade transaction but an
integral part of regional, national, and international agri value chains.
EoDA is critical for bringing efficiency in marketing and agri value chains, reducing losses,
and improving farmers' income.
The application of digital technology has become increasingly significant recently.
States like Madhya Pradesh, Chhattisgarh, Andhra Pradesh, Karnataka, Telangana, Tamil
Nadu, and Uttar Pradesh have already implemented process automation or are in the
process.
Ease of doing agri.trade could be a jointly developed index by DA&FW and state
governments, published quarterly by DA&FW to foster healthy competition among states in
easing agricultural trade. This index would be an aggregate figure including different
parameters defining the ease of doing agritrade.
8.1.1 Parameters for EoDA:8.1.1.1 End to End Process Automation: This can be broadly
divided into three parts: the mandi process starting with the arrival of produce,
entry/registration of the farmer's produce with estimated weight, and subsequent processes
like assaying, weighment, billing, and online payment to the farmer's account. The policy
also mentions automation of documentation and reports.
8.1.1.3 Digital Issuance of Licence/ Registration: This should also be digitally enabled for
traders, commission agents, private market operators, direct buyers, e-trading platform
operators, and other market functionaries. Digitisation makes the process of issuance
transparent, easy, and less time-consuming compared to the current physical format used in
most states. Automation of all licensing processes for establishing private markets and
e-trading platforms is also mentioned.
8.1.1.4 Security Deposit and rationalization of Licence/Registration Fees and Security: This
specific subsection number (8.1.1.4) is not explicitly present in the provided source text, but
the concept of rationalizing fees and security for licensing/registration is mentioned under
Policy Intervention 8.2.2 and 8.2.3.
8.1.2.1 Market fee collection process automation and online payment gateway: This specific
subsection number (8.1.2.1) is not explicitly present in the provided source text, but Market
fee collection process automation and online payment gateway are mentioned as
parameters for EoDA in the ideal Digital Application Overlay.
8.2 Policy Interventions:DA&FW will endeavour to formulate a scheme with state
governments to digitally automate processes in all states/UTs to track produce along the
supply chain, reduce leakage and turnaround time, avoid delays, and ensure transparent
direct payment into farmers' accounts.
The Executive Committee on Agricultural Marketing Reforms will study state-wise
licensing/registration processes, fees, security, and validity, and also rationalise market fees
& commission charges.
The committee will urge states to make licensing/registration processes digital, linking with
state-specific regulations, in a time-bound manner. Licensing/registration fees and security
may also be rationalised.
DA&FW will develop an indexing table based on these parameters to promote “ease of doing
agri-trade”. This table will be regularly updated and shared with states to create healthy
competition.
The Union Agriculture Minister will honour the top three states for adopting and
implementing "ease of doing agri-trade" provisions based on the indexing table ratings.
Chapter 9: Robust Market Information & Intelligence System

9.1 Situational Analysis:Market information and intelligence are necessary for farmers to
make appropriate production and marketing decisions.
9.2 Policy Intervention:An endeavour may be made to develop a market intelligence system
by pooling existing knowledge and technology.
This system would help farmers and other stakeholders make intelligence-based production
and marketing decisions.
The system will be adapted to the requirements of Indian farmers and will regularly issue
advisories.
Chapter 10: Market and Price –Risk Mitigating Measures and Policy Intervention
10.1 Situational Analysis:Farmers and agriculture face uncertainties and risks related to
Monsoon and Market, which need mitigation for sustained income.
There are three market and price risk mitigating instruments: Contract Farming, Market
linkage through FPOs, and Price Insurance Scheme.
10.1.2 Market linkage through FPOs: This is mentioned as one of the three market and price
risk mitigating instruments.
10.2 Policy Intervention:Efforts will be made to bring almost all farmers under farmers'
organisations like co-operatives, FPOs, SHGs, etc., due to fragmented land-holdings, market
inaccessibility, and price uncertainty.
An endeavour will be made to develop a Digital Public Infrastructure (DPI) as a Contract
Farming (CF) facilitation registry, potentially part of the Market–Stack. This registry will serve
as a repository for information on FPOs willing to participate in contract farming and
agro-industries interested in CF.
DA&FW may endeavour to roll out a “Price Insurance Scheme” to insure farmers' income for
assured income at the time of sowing. Modalities can be developed later.
Chapter 11: Marketing System for North-Eastern and Hilly Region and Policy Intervention

11.1 Situational Analysis:11.1.1 Production Scenario:The North-Eastern Region (NER)

consists of 8 states (Arunachal Pradesh, Assam, Manipur, Meghalaya, Mizoram, Nagaland,
Tripura, Sikkim). J&K is known for quality dry fruits.
11.1.2 Snapshot of Marketing Scenario:In NER states, Grameen haats are crucial marketing
channels, even more important than APMC markets. These are mostly bi-weekly, weekly, or
sometimes daily. They are critical for providing marketing facilities, particularly for small,
marginal, and women farmers who sell their produce there.
Himachal Pradesh and Uttarakhand have partially reformed APMC Acts. Himachal Pradesh
has 10 Principal Market Yards (PMYs) and 69 Sub-Market Yards (SMYs), totalling 79 APMC
market-yards, most of which are seasonal, focusing on horticultural crops.
eNAM operations in these regions are not satisfactory.
11.2 Policy Intervention:Recognising that the topography, land-holding size, cropping pattern,
predominance of horticultural crops, and marketable surplus in NER states and hilly regions
(H.P., Uttarakhand, J&K, Ladakh) are different from other states, the requirements for the
marketing ecosystem in these regions are also different.
DA&FW should formulate model market regulations and other marketing policies separately
for the NER and hilly regions to suit their specific needs.
A separate chapter for NER states will be added in future policy frameworks.

Chapter 12: Marketing System for States/ UTs with No APMC Acts and Policy Intervention

12.1 Situational Analysis:

12.1.1 Production Scenario:Bihar is an important agriculturally potential state with ~80% of
the population engaged in agriculture. It ranks 4th nationally in fruits and 8th in vegetables,
being the largest producer of litchi and third largest of pineapple.
In Lakshadweep, the cultivable land is 2510 ha with 700 ha under coconut. Coconut surplus
is transported to Kerala or Karnataka.
12.1.2 Snapshot of Agricultural Marketing:Bihar repealed its APMC Act in September 2006.
Consequently, agricultural produce can now be traded anywhere by anyone as regulation on
notified produce was withdrawn.
The Government of Bihar recently resolved to establish a "Marketing Directorate" under the
state agriculture department to ensure reasonable price realisation for farmers, promote
storage, value addition, processing, and develop grameen haats.
In Kerala, 25 regulated markets were established under the Kerala Agricultural Market
Projects (KAMP) with EU financial assistance. These markets, under the Directorate of
Agriculture, function under non-statutory rules and have basic infrastructure. Farmers are
registered individually or as groups.
In Lakshadweep, the superior quality coconut surplus is transported out. There is no need
for further improvement in the agriculture market ecosystem in these two small UTs
(Lakshadweep and A&N Islands, though A&N Islands production scenario is not detailed).
12.2 Policy Intervention:For states and UTs like Bihar, Kerala, A&N Islands, and some NER
states where the APMC Act is not implemented, there is "NO" need for an APMC Act.
However, for promoting orderly marketing, safeguarding farmers' interests, and ensuring
better price realisation, a regulatory framework is necessary.
DA&FW may take up with the state government of Kerala to integrate their well-performing
markets with the eNAM platform to access wider markets.
Chapter 13: Capacity Building and Policy Intervention

13.1 Situational Analysis: This subsection number (13.1) is not explicitly present in the
provided source text, but the Chapter title mentions "Capacity Building and Policy
Intervention". The subsequent text directly moves into policy interventions.
13.2 Policy Intervention:The Extension Division of DA&FW, along with states, will review
ongoing extension activities under ATMA and develop market-centric training modules.
These modules will be executed with KVK and state extension machinery.
The Marketing Division of DA&FW, with CCS NIAM, Jaipur, DMI, and states, will prepare
holistic and capsule-type strategic training programmes for various stakeholders including
farmers, traders, commission agents, FPOs, SHGs, agri start-ups, and agripreneurs.
These training programmes aim to sensitise FPOs and PACS on quality production,
marketing, and project management, and train stakeholders on infrastructure creation
support schemes.
Chapter 14: Miscellaneous

14.1 Commencement and Continuance of Policy:The national policy framework on

agricultural marketing shall come into force from the date of its notification.
It will have a specified tenure, although the specific duration is not mentioned in the provided
text.