Government of Karnataka
Department of Agricultural Marketing
Karnataka State Agricultural Marketing Board
Agricultural Marketing
Reforms in Karnataka
Presented By
G. N. Shivamurthy,
IAS.,
Director of Agricultural Marketing and
M.D. Karnataka State Agricultural Marketing Board
Vision and Mission
• Vision: To promote and encourage participatory
and equitable socio-economic development of
farmers in particular and stakeholders of the
market in general of Karnataka through vibrant,
self reliant and competitive agricultural marketing
system.
• Mission: To develop participative, transparent
and scientific Agricultural Marketing System
with adequate infrastructure and user friendly einitiatives.
Agricultural Marketing in Brief
 The Karnataka Agricultural Produce Marketing (Regulation
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and Development) Act, 1966 and Rules 1968
There are 156 main and 355 sub-markets.
92 agricultural commodities are notified for the purpose of
regulation (foodgrains, oilseeds, fruits, vegetables, cotton,
jaggery, arecanut, coconut, cashewnut, livestock)
Around Rs. 33,000 crores worth commodities transacted in
APMCs annually.
About 36,000 traders and 18700 commission agents are
licenced to operate in the market yards
APMCs are managed by a Committee consisting of elected
representatives of farmers (11), traders and commission
agents (1), marketing co-op. (1), processing co-op (1), Govt.
nominees (3) and official (1) ---Totally 18
Some of the Schemes
• Provision of infrastructure facilities in market yards
through annual action plans of APMCs
• Market Development under RKVY assistance
• Rural Market Development under RIDF Scheme
• Development of backward area markets
• Technology parks for Rice and Maize
• Floor Price Scheme- Revolving Fund
• Capacity building through training and extention
• Market information through website, sms, toll free
phone
• Welfare schemes for farmers and shramiks
Karnataka on the forefront of
Agricultural Marketing Reforms
• As per the Model Act 2003 of Government of India the
State has amended the Act in 2007 and Rules in 2008
and brought in the following reforms. Major
amendments include
---Establishment of Private Markets
---Establishment of Farmer-Consumer Markets
---Contract Farming
---Development of markets under Public Private
Partnership
---Establishment of Grading and Standardisarion
Bureau
---Establishment of Direct Purchase Centres
---E-Trading—Establishment of Spot Exchanges
STATE AGRICULTURAL MARKETING REFORMS COMMITTEE
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The Karnataka Government constituted a Committee
on Agricultural Marketing Reforms on 27-3-2013 to
identify the major problems and suggest needed
interventions
The Committee submitted its report on 15-5-2013
Major recommendations of the Committee are:
--- Introduction of Comprehensive Electronic Auction
System in APMCs
--- Introduction of technology in all activities including
weighment, payment, filing of returns, payment of
market fee, charges, etc.
--- Encouragement to Warehouse based sales
---PACS and TAPCMS to act as aggregators
---Capacity Building
RecommendationsAgricultural Marketing Reforms Report
Transparency
• In all market
operations
Efficiency
• Use of technology
• Information
dissemination
• Increased competition
Simplify
• Process flow in
operations
• Financial process
AMRC Recommendations
• Leveraging technology
• Information Dissemination
• Integrating Markets
• Creating Virtual Markets
• Commodity Funding
AMRC Recommendations
•
Farmer Producer Organisations
•
Private Markets
•
Secondary Market Linkages
•
Creation of Infrastructure
•
Capacity Building for
Stakeholders
Karnataka Agricultural Marketing
Policy 2013
The policy aims at
“Creating hassle free market for the agricultural
produce to help the farmers to obtain best price for
their produce.”
AMRC KAMP 2013
Karnataka Agricultural Marketing
Policy 2013
• Improved access to markets
– Accredited Warehouse as sub-market yards,
alternate and safe storage options
– Access to market through aggregation at
village level
– Linkages with financial Institutions
– Simple process for pledge loans
AMRC KAMP 2013
Karnataka Agricultural Marketing
Policy 2013
• Enable true price-discovery
Agricultural produce
of
the
– Primary value addition of agricultural
produce at village level
– Grading and assaying at market yard and
warehouse
– Market integration
– Increased competition
AMRC KAMP 2013
Karnataka Agricultural Marketing
Policy 2013
• Address delay in Payments
– Timely payment from buyer to be routed
through Bank accounts
– Online transfer of Payment
– Transparency in Payments
AMRC KAMP 2013
Karnataka Agricultural Marketing
Policy 2013
• Empowerment of Farmers
– Simplified marketing processes and ensuring
online timely payment to the farmers account.
– Market Access; Physical, Information and Financial
– Organize farmers groups to initiate primary value
addition and encourage village level aggregation
– Farmer to decide when to sell the produce and at
what price, with a right to reject the price offered.
AMRC KAMP 2013
Karnataka Agricultural Marketing
Policy 2013
Increased competition
Better Market Access
Timely payment
Market
reforms
Market automation
True price discovery
Farmer Empowerment
Trader 1
Trader 2
Single
virtual
Market
Traders 3
Unified Market
Platform
APMC
APMC 1
Warehouse 2
Warehouse 1
Market Integration Scenario
APMC 2
AMRC KAMP 2013
Amendments to Act
Enabling warehouse
based sales
Perishable - market
fee waiver
Single trader license
Private market fee
rationalization
Exemption from
market fee for FPOs
Concessional Market
fee for Direct
purchase centers and
Private Markets
Simplification of
Contract farming
arrangements
AMRC KAMP 2013
Amendments to Rules
Simplified
procedure for
issue of single
trading license
Provisions to
notify markets for
trading on unified
market platform
Arrangement for
Assaying
Enabling
provisions for
online payments
Provisions for
dispute resolution
Provisions for
transaction charge
to be levied
AMRC KAMP 2013
S P V
• Rashtriya e Market Services Pvt Ltd.
“A Special Purpose Vehicle (SPV) with a
Mandate to operate with cutting edge technology
and be constantly adapting the practices of
advanced markets to the agricultural markets in
the state, to ensure market efficiency and
competitiveness in the agricultural market system
for the benefit of farmers and consumers, while
making participation of all other market
participants sustainable”
AMRC KAMP 2013
S P V Structure
• A JVC between GOK and NSPOT
• Rashtriya e Market Services Pvt. Ltd ( 20th January
2014)
• Share holding pattern of 50:50
• Chief Secretary GOK as Chairman
– 3 Directors each from GOK and NSPOT
– 3 Independent Directors
– Provision to raise the total to 12 directors
– Certain matters Reserved for Government
(up till GOK holds up to 10%)
AMRC KAMP 2013
Trader 1
Delhi
Single
virtual
Market
Trader 2
Bangalore
Traders 3
Hubbali
Unified Market
Platform
APMC
Gadag Market
Shimoga Market
Warehouse
Raichur
Market Integration
Tiptur Market
Unified Market Platform
Trading platform capable of –
•
•
•
•
Providing multiple price discovery models
Risk management on par with exchanges
Flexible parameters for various markets
Displaying assayed parameters for quality
based bidding
• Supporting browser based and SMS based
bidding
Unified Market Platform
Material accounting module capable of
• Tracking of goods
• Reconciliation of quantities arrived and
exited
• Inventory tracking – trader wise,
commission agent wise, etc.
Unified Market Platform
Trade fulfilment module capable of
• Managing post trade processes.
• Integrated pre and post sale processing.
• Setting up flexible rules depending on the
market.
Unified Market Platform
Fund management module capable of –
• Collecting funds from buyers and crediting to
sellers
• Payment of commission agent charges
• Collection of market fee
• Collection of other dues – weighing,
warehouse rents, etc.
• Maintenance of individual ledgers for
accounting
Unified Market Platform
Document management module capable of
• Generating sale bills, purchase bills, etc.
• Generating permits for transportation, with
automated verification
• Management of returns to be filed
• Elimination of reconciliation currently required
Process flow in UMP market:
Unique lot
Number
given
Farmer with
produce
comes to APMC
APMC Gate entry
Produce exposed
on the platform
ready for sale
Post auction Activity
Sale bill
Payment
Delivery
E permit
Bid finalization
SMS to Farmer
Highest bidder
wins lot
Bidding across for
the lots available
UNIQUENESS OF THE KARNATAKA PROJECT
Not a mere computerization
effort,
Redesigning of the market
structure
Connecting
markets
Breakaway from the
traditional IT architecture
More comprehensive
and
all encompassing
Ease of adding markets
and
ease of replication
Phases of Implementation
SlNo
Month & Year
No of Markets
1
February, 2014
3
2
July, 2014
4
3
August, 2014
10
4
September, 2014
14
5
October, 2014
7
6
November, 2014
8
7
December, 2014
8
Phases of Implementation
SlNo
Month & Year
No of
Markets
1
January, 2015
3
2
March, 2015
1
3
April, 2015
1
4
June, 2015
2
5
August
19
Total
74
List of 74 UMP Markets
SL
Market
Live On
SL
Market
Live On
1
Tiptur
22/02/14
19
Turvekere
04/09/14
2
Arasekere
22/02/14
20
Huliyar
04/09/14
3
Chamrajnagar
22/02/14
21
Hosdurga
08/09/14
4
Gadag
09/07/14
22
Sira
09/09/14
5
Chitradurga
17/07/14
23
Bhadravathi
09/09/14
6
Tumkur
28/07/14
24
Bagalkote
15/09/14
7
Bijapur
30/07/14
25
Haveri
15/09/14
8
Challakere
01/08/14
26
Soundatti
18/09/14
9
Hubli
01/08/14
27
Ramdurga
21/09/14
10
Dharwad
08/08/14
28
Siddapura
26/09/14
11
Gubbi
11/08/14
29
Bailahongal
26/09/14
12
Bellary
12/08/14
30
Channagiri
27/09/14
13
Mandya
15/08/14
31
Harapanahalli
27/09/14
14
Raichur
16/08/14
32
Annigere
07/10/14
15
Kottur
21/08/14
33
Haliyal
11/10/14
16
Koppal
22/08/14
34
Hiriyur
11/10/14
17
Mundargi
26/08/14
35
Bhimasamudra
21/10/14
18
Yadgir
01/09/14
36
Manhalingpura
21/10/14
List of 74 UMP Markets
SL
Market
Live On
SL
Market
Live On
37
Bidar
29/10/14
56
Tarikere
06/08/2015
38
Mysore
31/10/14
57
Bhalki
06/08/2015
39
Thirthhalli
01/11/14
58
Kalaghatagi
06/08/2015
40
Shimoga
05/11/14
59
Basavakalyan
08/08/2015
41
Yellapura
11/11/14
60
Humanabad
09/08/2015
42
Byadgi
14/11/14
61
Badami
07/08/2015
43
Ranebennur
18/11/14
62
Shiggon
10/08/2015
44
Sagar
18/11/14
63
Talikote
11/08/2015
45
Birur
20/11/14
64
Chintamani
11/08/2015
46
Sirsi
25/11/14
65
Hagaribommanahalli
11/08/2015
47
Surpur
20/12/14
66
Savanur
12/08/2015
48
Madhugiri
23/12/14
67
Kushtagi
13/08/2015
49
Kadur
08/01/15
68
Lingasugur
17/08/2015
50
Nargund
08/01/15
69
Sedam
21/08/2015
51
Pavgad
10/01/15
70
Shahapur
25/08/2015
52
Gajendragada
21/03/15
71
Santhesaragur
28/08/2015
53
Laxmeshwar
23/04/15
72
Gundlupet
29/08/2015
54
Hosanagar
20/06/2015
73
Kollegal
31/08/2015
55
Kunigal
30/06/2015
74
Belgaum
31/08/2015
MONTH WISE DETAILS OF TRANSACTIONS IN ALL
MARKETS
Month
Number of Lots sold Traded quantity in
on UMP
quintals
Value (Rs in Crores)
Feb
March
April
May
June
July
Aug
Sep
Oct
Nov
Dec
Jan
Feb
March
April
May
June
726
1913
4080
3938
2750
9708
44319
90204
107384
200679
293943
313998
400309
276877
218142
140175
91987
12048
31606
40409
35918
33998
78695
245298
735870
1439244
2477258
1174145
3397476
5938794
6741137
5671473
6251556
6288286
10
27
43
42
44
79
149
278
337
566
682
1267
1936
1049
877
1135
629
Total
2201132
40593214.88
9151