PM Modi may soon announce these 3 new agri marketing reforms
By Parish Tyagi
After the MSP hike last week, the Narendra Modi government is getting set to appease farmers with yet another reform. And this will be via a new procurement policy which attempts to eliminate the middle man, senior officials from farm ministry exclusively told ET NOW.
The government may roll out a new mechanism comprising three crop specific procurement measures detailed below:
* Price Deficit Scheme: Under this procurement mechanism, the government will compensate farmers in case the market rate at government mandis is higher than the minimum support price or MSP. This was introduced as a pilot project called 'Bhavantar' in Madhya Pradesh last year, and is the brainchild of Dr Ramesh Chand of the Niti Aayog.
* Market Assurance Scheme- States will be empowered to procure certain crops directly without the approval of the Centre. This new mechanism will enable states to decide how much of what crop to procure, and also give them the freedom to select between state and central agencies for the actual procurement.
* Private procurement and stockists Scheme- The government will incentivise private players for purchasing crops from farmers at the MSP.
The agriculture ministry has been working on these schemes in collaboration with Niti Aayog, and concluded that one mechanism alone is insufficient. "The government now intends to rely on a "bouquet" of new measures for different crops", a senior official told ET Now. The ministry is finalising a Cabinet note for the same.
The timing is indeed interesting, and experts say the Modi government is keen to implement all this ahead of the 2019 General Elections.
The government had last week announced the MSP of kharif crops for 2018-19 season and claimed to have fixed it at 50-70% higher than the cost of production.
After the MSP hike last week, the Narendra Modi government is getting set to appease farmers with yet another reform. And this will be via a new procurement policy which attempts to eliminate the middle man, senior officials from farm ministry exclusively told ET NOW.
The government may roll out a new mechanism comprising three crop specific procurement measures detailed below:
* Price Deficit Scheme: Under this procurement mechanism, the government will compensate farmers in case the market rate at government mandis is higher than the minimum support price or MSP. This was introduced as a pilot project called 'Bhavantar' in Madhya Pradesh last year, and is the brainchild of Dr Ramesh Chand of the Niti Aayog.
* Market Assurance Scheme- States will be empowered to procure certain crops directly without the approval of the Centre. This new mechanism will enable states to decide how much of what crop to procure, and also give them the freedom to select between state and central agencies for the actual procurement.
* Private procurement and stockists Scheme- The government will incentivise private players for purchasing crops from farmers at the MSP.
The agriculture ministry has been working on these schemes in collaboration with Niti Aayog, and concluded that one mechanism alone is insufficient. "The government now intends to rely on a "bouquet" of new measures for different crops", a senior official told ET Now. The ministry is finalising a Cabinet note for the same.
The timing is indeed interesting, and experts say the Modi government is keen to implement all this ahead of the 2019 General Elections.
The government had last week announced the MSP of kharif crops for 2018-19 season and claimed to have fixed it at 50-70% higher than the cost of production.