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Ease of Doing Agribusiness Index

  • 14 Nov 2018
  • 6 min read

Ministry of Agriculture has proposed a new index to gauge the performance of states in implementation of policies and programs of government of India in the field of agricultural reforms.

  • The concept is to consider farming not solely as a production-oriented activity carried out to achieve food security for the country but as a business activity carried out by farmer as entrepreneur.
  • The index will measure performance of state on various sub-parameters
    • Marketing Reforms
    • Reducing cost of inputs
    • Governance and Land reforms
    • Risk Mitigation
    • Increasing production/productivity
    • Investment in and for agriculture

Significance of Initiative

  • It will help in developing competitive spirit among the states and develop their performance to the highest level.
  • It will allow central government to plug the gaps in schemes and programmes and bring the states lagging behind in implementation up.
  • By this index, Ministry of Agriculture will be able to reward high performing states, by linking their performance with allocation of funds.

Measures taken by Government for Farm Sector Reforms

  • Marketing Reforms
    • The Model “The Agricultural Produce and Livestock Marketing (Promotion and Facilitation) Act, 2017”
      • This is a model law seek to end the monopoly of Agricultural Produce Market Committee (APMC).
      • This act has provision that entire state would be treated as a single market, which will remove area limitations of APMC.
      • It will enhance farmers produce by providing conditions for creation of private wholesale markets along with farmers-consumer market yards.
      • It will enable direct contact between farmers and consumers or other end-user categories.
      • APLM act will also give freedom to the farmer to sell his property to any person or agency at his place of choice, making him get a better return.
      • This is a model act state can adopt it fully or partially in their own acts as Agriculture is a state subject
    • National Agriculture Market Scheme (e-NAM)
      • National Agriculture Market (NAM) is a pan-India electronic trading portal which networks the existing APMC mandis to create a unified national market for agricultural commodities.
      • NAM Portal provides a single window service for all APMC related information and services.
  • Reducing Input Cost
    • “Paramparagat Krishi Vikas Yojana (PKVY)”
      • PKVY aims to increase the area under organic farming as it ensures higher income to farmers due to comparatively lower cost of cultivation and premium price of organic.
    • Mission Organic Value Chain Development for North Eastern Region (MOVCDNER)
      • This was launched for realising the potential of organic farming in the North Eastern Region of the country. It is a central sector scheme which has been launched to develop North East as organic hub of India.
    • Soil Health Card
      • Soil Health Card is one of the largest universal Soil Health Card Schemes in the world. It aims to provide information about fertility of land to farmers based on testing soil samples for 12 parameters.
    • Pradhan Mantri Krishi Sinchayee Yojana (PMKSY)
      • PMKSY is being implemented to expand cultivated area with assured irrigation, reduce wastage of water and improve water use efficiency. Focus of the program is to provide end-to-end solution to irrigation supply chain through
        • development of the water resources
        • creation of an efficient distribution network
        • improvement of farm level management
        • water-use efficiency.
  • Governance and Structural Reforms
    • Encouraging Contract Farming
      • The government has approved Model Contract Farming Act which will help farmers to enter pre-season price agreement on their produce
    • Right of Lease Farming
      • NITI Aayog has developed Draft Model Agriculture Land Leasing Act and has circulated it to states for adoption.
      • This act has provisions which recognizes land leasing and ensure complete ownership of land ownership right while recognizing the lease holders.
  • Risk Mitigation
    • Pradhan Mantri Fasal Bima Yojana (PMFBY)
      • PMFBY aims to provide insurance at lowest premium rate to farmers with added benefits.
      • Under the PMFBY, a uniform maximum premium of only 2 per cent will be paid by farmers for all Kharif crops and 1.5 per cent for all Rabi crops and 5 percent for annual commercial and horticultural crops.
      • The premium rates to be paid by farmers are very low and balanced premium will be paid by the Government, shared equally by State and Central Government.
      • The scheme covers risk from pre-sowing to post harvest stages and there is no upper limit on Government subsidy.

Agricultural Marketing & Farm Friendly Reforms Index

  • This Index was launched by NITI Aayog.
  • NITI Aayog has launched this index to rank States and UTs based on implementation of seven provisions related to farm sector reforms.
  • This indicator reveal ease of doing agribusiness as well as opportunities for farmers to benefit from modern trade and commerce and have wider option for sale of her/his produce.
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