India: Nashik growers not impressed by new law

Grape farmers in Nashik and pomegranate growers in Solapur and Ahmednagar have long been selling their goods outside the Agriculture Produce Market Committee (APMC) mandis. They have been doing this even before the Maharashtra government, in July 2016, deregulated fruit and vegetable sales, by allowing their trade outside of these regulated markets.

For grapes and pomegranates, the buyers mostly come to the farm-gate and load the fruits directly from there, with very little produce being traded in the mandis. Farmers typically have longstanding relationships with traders with whom they strike deals. The latter come to the vineyards/orchards when the crop is almost ready and make an initial part payment at the agreed price. The remaining amount they pay after the total quantity to be bought is harvested.

All these transactions are essentially underwritten by trust. There are no written documents here that farmers can produce if a trader was to dishonour an agreement, a situation that happened far too often. That explains why some growers aren’t particularly impressed with the recently passed law — the Farmers’ Produce Trade and Commerce (Promotion and Facilitation) Act, 2020 — that permits free sale and purchase of crops outside the physical premises of APMC mandis.

“It looks fine in theory. But who will guarantee my payment even though the Act says that it has to be made within three working days? And what can the police or SDM (sub-divisional magistrate) do if a trader defaults or runs away?,” one growers asked

“Some traders have sought to buy directly from my field, but my experience with grapes has made me wary of such deals. In APMCs, they have at least a mechanism to ensure payment even if the price may be less and I need to haul my produce there,” he added.

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