General Knowledge

What is the Importance of Agricultural Marketing in India and Govt Measures?

Agricultural marketing is the involvement of assembling, storing, processing, packaging, grading, transportation, and distribution of agricultural commodities from the farmers to the end consumers.

Main Problems Faced by the Farmers with Agricultural Marketing

a) Too Many Intermediaries.

Farmers and the market are connected to many intermediaries, they exploit the farmers by buying the products at low prices and sell them to the market at the highest price.

Here, intermediaries earn more than a farmer who works hard day and night to survive.

b) Faulty Weights and Manipulation of Accounts.

In the rural areas still, old methods of measuring weights are in practice and the farmers are cheated because they are illiterate the accounts are handled by intermediaries.

As a result, it is easy for intermediaries to manipulate accounting books and pay less to farmers.

c) Lack of Storage Facilities.

Due to low prices, farmers store their products until prices rise in the market, but due to the lack of modern and scientific storage facilities, they lose around 10% of the products by spoiling each year.

Therefore, apart from marketing, farmers need a large number of storage units in their neighboring locations.

d) Lack of Transportation Facilities.

Another important problem is transportation, the distance between the farms and the market is too long and the cost of transportation makes farmers cry because the profits are decreasing.

Farmers sell agricultural products to middlemen to avoid these problems, but intermediaries take advantage and loot them.

Importance of Agricultural Marketing in India

Agriculture is the backbone of our country because our population is very large and the demand for basic commodities to satisfy the country’s hunger is high.

And it is the main source of livelihood for more than 58% of our country since our country has more villages and rural areas, it is practiced for generations from ancient times till today.

In the modern world, spending is increasing, and gains are low. Therefore, farmers sell their land to industries and convert cultivated land into dry or wasteland.

If this continues, we face the problem of the shortage of food supplies. To eliminate this type of situation, we must first strengthen the farmer’s capacity to obtain more income for growing their crops.

Therefore, to strengthen the farmer and increase the food supply chain, central and state governments take joint measures to reach farmers’ products to consumers using different agricultural marketing methods at a good price by eliminating intermediaries and ensuring that farmers get the maximum benefit, as well as the end customers to get the lowest price.

As a result, the growth of GDP and the stability of food chain management is the most important aspect of the Indian economy.

a) Agricultural marketing is one of the many problems that have an immediate impact on the prosperity of farmers since India is associated with rural agriculture and up to 70% of the population depends on it.

b) Agriculture provides raw materials to numerous Industries and so, advertising and promoting of such industrial crops like cotton, sugarcane, oil-seeds, and so on.

c) The Marketing method brings new varieties, qualities, and helpful products for shoppers and, as a result, selling acts as a line between production and consumption.

d) An advertising gadget can grow to be an immediate supply of new technical understanding and set off farmers to adopt updated clinical methods of cultivation.

e) A reduction in the cost of marketing is a direct benefit to the end consumer.

f) Elimination of middlemen is possible only when farmers directly involved in Agricultural Marketing.

Government Measures in Improving Agricultural Marketing

1) Market Surveys

Various surveys have been conducted and published by the Government for various goods, and Problems with remedies suggested.

Wide publication of the price of different Agricultural goods in different markets is collected through the market survey.

2) Development and Strengthening of Grading and Standardization System 

Setting up of Grading stations under Agricultural Produce (Grading and Marketing) Act, 1937 for products like ghee, flour, eggs, etc.

Laying down of standards for 162 Agricultural and allied products.

Assigning ‘AGMARK’ to the graded products which ensure good quality and also command a better price in the market.

Setting up of central quality control laboratory at Nagpur along with eleven regional laboratories for testing of products applying for ‘AGMARK’. So far 108 rules for Agricultural commodities have been framed.

3) Setting up of Regulated Markets and Strengthening Agricultural Marketing System

The regulated markets are set up to eliminate unhealthy market practices and protect the interests of the farmers.

Agriculture is a state subject, a model APMC Act was formulated and circulated to the states/UT’s in the year 2003 for adoption.

There are 7,114 regulated markets in India as on 31-03-2014 that caters to need of approximately 80% Agricultural products.

The Central Sector Scheme launched on 20-10-2014 under which credit-linked investment subsidy is provided for general or commodity-specific marketing infrastructure for Agricultural and allied commodities.

The scheme is linked to implementing 3 reforms namely.

  • Setting up markets in a Private and Co-operative sector.
  • Provision for contract farming.
  • Provision for direct marketing.

It is being implemented in those States /UT’s which has amended its APMC Act accordingly.

4) Strengthening the provision of storage and warehousing facility.

Necessary to prevent wastage and distress sale of farmers it is highly necessary. Hence, Central Warehousing Corporation was set up in 1957 with the purpose of constructing and running godowns and warehouses.

States have also set up warehousing corporations for the same purpose.

The FCI has its own network of storage facilities. The launch of ‘Grameen Bhandaran Yojana’ (Rural Godown Scheme) 01-04-2001 with the main objective of creating scientific storage capacity with allied facilities in rural areas.

5) The Organization of the Co-operative Marketing System.

These are multi-purpose organizations with an emphasis on credit and marketing.

Primary promoting societies are inspired to make societies at State and apex level National Agricultural promoting Federation (NAFED) and National Climatic Data Center.

Large financial and other support has been provided by the Government.

6) Setting up of Special Boards and Organisations.

The Central Government has set up a number of such boards for unique commodities like Rice, Pulses, Millets, Oilseeds, Sugarcane, Jute, Cotton, Tobacco, and so forth.

Directorate of Marketing and Inspection (DMI) at Faridabad for the promotion of standards and grading of Agricultural and allied produce.

Ch.Charan Singh National Institute of Agricultural Marketing (NIAM), Jaipur for providing training in the field of Agricultural Marketing.

Small Farmers Agricultural – Business Consortium (SFAC), New Delhi for promoting Agricultural business for small and marginal farmers.

7) Marketing Research and Information Network (MRIN) Scheme.

An ICT based Central Sector Scheme of Marketing Research and Information Network (AGMARKNET) was launched in March 2000. Aimed to provide electronic connectivity to important wholesale markets in the country.

Information relating to prices, the arrival of commodities, and other market-related information is provided on the portal. More than 3,200 markets are covered under the scheme.

8) Appointment of Inter-Ministerial Task Force on Agricultural Marketing Reforms.

It aims at the Promotion of direct marketing and contract farming, development of Agricultural Markets in Private and Co-operative Sectors, expansion of future trading to cover Agricultural products, Introduction of negotiable warehousing receipts system, use of Information Technology.

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