Two Ordinances to herald a possible paradigm shift in rural India

Agri Research

Close on the release of the Atmanirbhar Package, the Centre promulgated two Ordinances this week which could have lasting impact on India’s rural economy.

The first of the Ordinances permits the Farmer to contract for the sale of his produce directly with buyers other than the monopolistic State regulated Market Yards. You could, therefore, have a large private Sector player from Mumbai say, picking up produce from AP farmers. The Ordinance provides that the buyer shall pay within 30 days. Disputes would not go to Court, but resolved at the District Magistrate / Collector level.

The second Ordinance permits the Farmer to commit his entire crop in advance to a buyer, who would bear the risk of any price fall/loss of produce at harvest time. On the other hand, if the price is higher there would be a mechanism for the Farmer to share a part of the bounty. Details are yet to be worked out.

Both Ordinances are in areas where the State to have a role. How they react is to be seen.  The Farmer has to quickly grasp the nuances of digital commerce as platforms aggregating potential buyers and Farmers would herald the third Tech Wave –the first two being FinTech and HealthTech.

Author: Arvind Singh

Tags: Agri research

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