Understanding the Indian agricultural market and the questions that lurk on its existence

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A recent protest by the farmers, called the Kisan Mukti March was an event that shook the nation. Lakhs of farmers gathered on Delhi roads, demanding remunerative price for their crop and freedom from debt. A pamphlet distributed by farmers showcased the difference between the prices they received and the prices that the consumers pay for crops, dals and more. For instance, famers sold tomatoes for Rs 5 per Kg, while the consumers are paying Rs 30 for the same. “Our life is also cheap. In the last 20 years, over three lakh farmers have committed suicide,” the pamphlet said.

In retrospect

India is a country primarily based on agriculture. Despite large-scale modernization in cities, the backbone of the economy still lies in the hands of techniques like sowing, ploughing and reaping. Agriculture marketing plays a crucial role and drives one-third of the Indian economy.

What is agriculture marketing?

A vast term, agriculture marketing covers the services involved in moving agricultural products from the farm to the consumers. It also includes the overall process which involves planning, organizing, directing, and handling of agricultural produce for the farmer, producer and the consumer.

In the pre-modernization era, the agriculture market was a direct business where farmers used to sell or barter their products to the consumers. Today, the market has a structure that involves a few levels from the farmer to the customer. The demand and availability of the products also influences the market. The availability of stored products plays a crucial role as well.

Farmers today, sell their products to moneylenders, to whom they may be indebted, or to the village traders. Weekly markets held inside and outside villages, and mandis are another option for farmers to sell the produce.

Types of agricultural marketing

The agriculture marketing is divided into numerous categories.

Based on frequency

– Daily market
– Weekly market
– Monthly market

Based on product

– Grain market
– Fish market
– Fruit market
– Vegetable market

Based on marketing function

– Assembling
– Wholesale
– Retail

Based on location

– Local market
– Primary market
– Secondary market
– Terminal market

Problems faced by the agriculture market in India

The post-modernization market has been structured in multiple layers. This has led to multiple challenges faced by the farmers.

  • Middlemen

    Earlier, farmers were able to sell the produce directly to the consumers. Today, the market involves many middlemen, which has led to exploitation of the farmers and unequal division of money.

  • Malpractices

  • The involvement of middlemen and traders has made the market lose its integrity. Farmers today face numerous malpractices such as use of false weights and measurements, adulteration, black-marketing and more. This has created an unsuitable atmosphere leading to lack of money in the hands of the farmers.
  • Lack of financial resources

    The Indian farmer today lacks enough financial resources to practice farming effectively. Dependent on loans from banks or wealthy landlords, farmers lose out on a major section of the profit from their produce. Also, paying unrealistic interest rates adds to their misery.

  • Improper storage

    The lack of store houses forces farmers to sell their crops before the right time, making them lose huge amounts of money. Insufficient storage space and improper facilities also lead to loss of stored crops because of rodents and insects. Every year, this makes the farmers lose crore of rupees and thus, the economy faces a hit.

  • Corrupt policies

    Lack of standardization in the market makes it difficult for farmers to get the right price of their crops. With middlemen deciding the prices, exploitation has peaked, increasing the gap between the actual price of the crops and what the farmers are paid. While these middlemen buy crops leaving a very less margin for farmers, they sell it to consumers at a very high price.

Persisting problems, and the protest was a clear indication of how ineffective the current government policies are. The government and the middlemen fail to understand the scenario that will occur if the Indian agriculture market collapses. It is time an agrarian economy understands that its survival is still based on working in fields. A degradation of the agriculture market, and every other news being farmers committing suicide, will eventually lead to a day with no farmers, and a very bleak future of the nation.

Last modified: January 15, 2019

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