The upstream and downstream process of marketing of agricultural products in India involves various activities and actors that link the farmers with the consumers. The upstream process refers to the procurement of agricultural produce from the farmers by various intermediaries such as traders, commission agents, wholesalers, etc. The downstream process refers to the processing, packaging, distribution, and retailing of agricultural products to the consumers by various intermediaries such as processors, manufacturers, transporters, retailers, etc.
Some of the main bottlenecks in the upstream process of marketing of agricultural products in India are:
Fragmented and regulated markets: The Agricultural Produce Market Committee (APMC) Act regulates the marketing of agricultural produce in designated markets or mandis. However, these markets are often fragmented, monopolized, and inefficient, resulting in high marketing costs and low price realization for the farmers.
Presence of multiple intermediaries: The agricultural marketing chain in India is characterized by the presence of multiple intermediaries who often exploit the farmers by charging high commissions, fees, and margins, and manipulating the quality and quantity of produce.
Lack of market information and transparency: The farmers often lack access to timely and accurate information on market prices, demand and supply conditions, quality standards, etc., which affects their bargaining power and decision making. Moreover, there is a lack of transparency and accountability in the market transactions, leading to disputes and malpractices.
Inadequate infrastructure and facilities: The farmers face various infrastructural constraints such as poor road connectivity, lack of storage and warehousing facilities, inadequate grading and sorting facilities, insufficient cold chain facilities, etc., which affect the quality and quantity of produce and increase post-harvest losses.
Some of the main bottlenecks in the downstream process of marketing of agricultural products in India are:
Low level of processing and value addition: The level of processing and value addition of agricultural products in India is very low compared to other countries. This limits the scope for enhancing the shelf life, quality, variety, and competitiveness of agricultural products in domestic and international markets.
High cost and inefficiency of logistics: The logistics cost and inefficiency of transporting agricultural products from production centres to consumption centres is very high in India due to factors such as poor road conditions, traffic congestion, multiple taxes and tolls, lack of standardization and coordination among different modes of transport, etc. This affects the profitability and competitiveness of agricultural products.
Lack of quality standards and certification: The quality standards and certification systems for agricultural products in India are often inadequate, inconsistent, and non-compliant with international norms. This affects the consumer confidence and satisfaction, as well as the export potential of agricultural products.
Weak linkages among stakeholders: The linkages among various stakeholders involved in the downstream process of marketing of agricultural products, such as processors, manufacturers, distributors, retailers, etc., are often weak and unorganized. This affects the coordination, collaboration, and innovation among them.
What are some of the measures taken by the government to address these bottlenecks?
Some of the measures taken by the government to address these bottlenecks are:
The Agricultural Produce and Livestock Marketing (Promotion and Facilitation) Act, 2017, which aims to create a unified national market for agricultural commodities by allowing farmers to sell their produce across states and markets without any restrictions or fees.
The Farmers' Produce Trade and Commerce (Promotion and Facilitation) Act, 2020, which aims to provide farmers with the freedom to sell their produce outside the APMC markets to any buyer of their choice at remunerative prices through online platforms or physical modes.
The e-National Agriculture Market (e-NAM), which is an online trading platform that connects farmers with buyers across different APMC markets and enables transparent price discovery and quality assessment of agricultural produce.
The Pradhan Mantri Kisan Sampada Yojana (PMKSY), which is an umbrella scheme that integrates various schemes for food processing, infrastructure development, agro-clusters, backward and forward linkages, etc. to reduce wastage and enhance value addition of agricultural products.
The Pradhan Mantri Fasal Bima Yojana (PMFBY), which is a crop insurance scheme that provides comprehensive risk coverage to farmers against natural calamities, pests and diseases, post-harvest losses, etc. at low premium rates.
The Pradhan Mantri Krishi Sinchayee Yojana (PMKSY), which is a scheme that aims to enhance irrigation coverage and water use efficiency by promoting micro-irrigation, watershed development, rainwater harvesting, etc.
The Soil Health Card Scheme, which is a scheme that provides soil health cards to farmers that contain information on soil nutrient status, soil fertility, soil moisture, etc. and also gives recommendations on appropriate dosage of fertilizers and organic manures.
The National Mission for Sustainable Agriculture (NMSA), which is a scheme that aims to promote sustainable agriculture practices such as organic farming, integrated pest management, integrated nutrient management, conservation agriculture, etc. to enhance productivity and profitability of agriculture.