The price fluctuation of the vegetables and the exorbitant prices of certain necessary vegetables are a source of major concern for the citizens who visit the local markets to procure vegetables for their daily need. It is now an accepted fact that marketing for vegetables will burn multiple holes in the pocket of the consumer. Certain vegetables such as onion have simply become untouchable. Price of tomatoes keeps increasing without any apparent reason while the lack of proper storage facilities compels the farmers of North Bengal to dump their excess crop on the road. It is also to be mentioned here that the price of a certain vegetable, say onion, varies considerably from market to market. While the traders offer the excuse of transportation and storage costs to explain the rise in the vegetable prices, a survey conducted by the Global AgriSystems identified accurately where the shoe pinches.
The existence of touts and intermediaries in every vegetable trade (at least five or six in every vegetable trade chain) and the sheer wastage of 15% to 25% of the crops produced due to the dearth of a proper cold chain are the two main reasons. Added to this is the extortion money that a trader has to pay to conduct business in a market to the local ‘Dadas’. After that the arithmetic is simple. All these costs including storage and transportation are added to the price of a certain vegetable which naturally reflects on the increased cost price. More the number of middlemen involved more is the increase in the price of vegetables. These intermediaries (Bengali colloq. ‘Phores’) and the local colors are merely parasites living off the earnings of the farmers’, traders’ and consumers’ and the need is imperative to get these parasites permanently out of the vegetable trade chain.
Chief Minister of West Bengal, Mamata Banerjee’s plan of setting up of Brihat Krishi Bazar to make vegetable prices stable and affordable:
The CM’s plan of setting up of a Brihat Krishi Bazar (with a strict mandate of banning of phores within 8 kilometer radius of the said markets) in each district seems to be a perfectly viable solution to solve the vegetable price problem. As per the statement issued by Arup Roy, Agriculture Marketing Minister, “The Brihat Krishi Bazar, spread over 150 bigha will have a storage facility and processing units to use surplus produce. For instance, if there is a bumper crop of tomato or mango, the excess can be used to make sauces, jams or pickles. Or textile from jute. These ancillary units will create employment and also fetch revenue for the state”. He further added, “The Government will also set up facilities for grading and packaging of vegetables and will shortly invite expressions of interest from private parties”.
One of the integral parts of the CM’s Krishi Bazar project is obviously looping in the big names in processed food marketing and agricultural warehousing like Adani Wilmar and Keventer Agro (supplies vegetables under the brand name Keventer Fresh to Big Bazaar and Metro Cash and Carry). The said firms have also expressed interests in the participation of the CM’s Brihat Krishi Bazar project on a public private partnership (PPP) basis. The successful inclusion of these firms in the Krishi Bazar project will ensure availability of vegetables (using the international standard cold chain network of these firms) which in turn will stabilize the prices of vegetables at an affordable level and control price fluctuation. With the elimination of the phores the interest of the farmers as well as the consumers will be protected.
The carrot and stick approach of the government to attract the big players in the food processing business:
In order to explore the interests of the big names in food processing and agriculture warehousing, the Government has taken a carrot and stick approach. In exchange of a license granted by the Government, the private firms will be allowed to establish retail chains and sell their products directly to the consumers thus ensuring a firm foothold of the private investors in the Brihat Krishi Bazar project. The license obviously is the proverbial carrot to lure private firms to goad them into setting up of ‘mega farm markets’ (Brihat Krishak Bazars). The Brihat Krishak Bazar is a new project recently announced by the Government in an effort to consolidate the supply pipelines. As declared in this regard by a Government official, “Farmers will get a fair price for their produce if the intermediaries are removed. The consumers will also benefit as multiple price-markups at various stages between the farm and the retail market can be avoided”. In essence the Brihat Krishak Bazars will be ‘terminal markets’ where the big firms will be selling their products to all, including competitors and invest in creating the infrastructure at the same time.
Brihat Krishak Bazar Yojona:
The West Bengal Government has undertaken the Brihat Krishak Bazar Yojana program in an effort to allow direct purchase of farm products by the different private firms from the farmers. The scheme has already secured approval of the West Bengal state cabinet. Under the Agriculture Produce Marketing Committee (APMC) Act, the big names in agro warehousing, marketing and food processing like the Reliance, Metro Cash and Carry and Aditya Birla will be able to set up ‘terminal markets’. To make the execution of this scheme possible, a necessary amendment will soon be introduced on the current APMC Act, the present directive of which allows the major retail players to purchase from formal ‘mandis’ only. The government will choose the developers for this scheme through a competitive auctioning process. The chosen developers will invest in setting up the infrastructure of the ‘terminals’ which will include cold storage facilities, warehousing and processing units. The necessary license for buying, storing and processing of agricultural products will be granted by the Government. The State has envisaged its own pyramidal model of ‘partnership farming’. Under this system there will be a mutual accession between the Government, the private retail players and the farmers which in turn will protect the interest of the farmers.
This entire agricultural reform is a pro-farmers’ program. While the elimination of the ‘phores’ will ensure a fair price to the farmers, marketing for vegetables will no longer be burning holes in the pockets of the consumers. Once the big time private retailers join in, availability of the vegetables will be secured and at the same time the state of the art cold chain network of the private retailers will prevent wastage of excess agricultural product owing to lack of storage space. It is an excellent endeavor on the part of the West Bengal Government protecting the interests of the farmers, consumers and at the same time securing investment in the agriculture sector from the big time retailers.