Agricultural marketing involves the processes of collecting, storing, preparing, transporting, and distributing farm products across the country. The success of selling an agricultural product depends on several factors, including demand, availability of storage, and market access.

Challenges Before Independence

Before India gained independence, farmers faced severe exploitation when selling their products. They encountered incorrect weighing methods, manipulated accounts, and had no access to real-time price information. This forced them to sell their produce at very low prices, often with no proper storage facilities available.

Farmers typically sold their products at weekly village markets, neighboring villages, or larger markets known as mandis. However, if no formal market was available, farmers resorted to selling in irregular or informal village markets, often under unfavorable conditions. To address these challenges, the government introduced several reforms aimed at controlling trader activities and ensuring fair treatment of farmers.

Four Key Government Measures to Improve Agricultural Marketing

1. Market Regulation and Transparency: The government’s first step was to regulate agricultural markets, ensuring clean, transparent, and simple marketing strategies. These regulations benefitted both farmers and consumers. However, there is still potential for improvement, especially in realizing the full potential of rural markets.

2. Procurement and Infrastructure Development: The second measure focused on the procurement process, which included improvements in transportation, warehousing, cold storage, godowns, and processing units. Despite these efforts, India’s current agricultural infrastructure remains inadequate to meet the growing demands and requires further enhancement.

3. Fair Pricing for Agricultural Products: Establishing fair prices for farm products was another key area of focus. In the past, pricing faced challenges due to the unequal representation of farmers and a lack of coordination between marketing cooperatives and financial management systems. A successful example of this is the Gujarat milk cooperative (Amul), which transformed the social and economic landscape of the region.

4. Supportive Policies for Farmers: The final measure introduced policies aimed at safeguarding farmer incomes, including:

   • Minimum Support Prices (MSP): A guaranteed price for key agricultural products to protect farmers from market fluctuations.
   • Food Corporation of India (FCI): Responsible for storing surplus stocks of wheat and rice.
   • Public Distribution System (PDS): Ensuring the subsidized distribution of essential food grains like wheat, rice, and sugar to the underprivileged.

   These policies were designed to stabilize farmer incomes and provide affordable agricultural products to vulnerable populations. Despite government intervention, private traders still play a dominant role in agricultural markets, necessitating further reforms.