UP gives nod to retail chain stores for farm products

With the amendment in the "UP State Agriculture Marketing Act, 1964", approved by the cabinet, the decks have been cleared for the entry of the retail chain stores for procuring different agriculture products directly from the farmers. The ordinance amending the Act is likely to be announced shortly.

This was announced by Chief Minister Mayawati in a press conference here today. The chief minister said the new policy, Agriculture Infrastructure and Investment Policy, is likely to attract investment to the tune of Rs 40,000 crore by 2011 in the agriculture sector in UP.

The new policy, besides eliminating the middlemen in agriculture trade, is likely to give boost to "big" retail players in the state. The Mukesh Ambani's retail store chain Reliance Fresh will be the major gainer of the new policy announced here today.

Describing the policy as "historic" and "revolutionary", Mayawati said contract farming will be allowed. The investors have also been authorised to directly purchase the agriculture products from the farmers, she added.

Under the policy, the farmers will have the option to sell their crop outside the Mandi yard operated by the UP State Agriculture Marketing Board.

The private investors will have the right to set up private mandis where farmers will have the freedom to sell their crops while the small entrepreneurs will have the right to set up Kisan Bazar in joint sector. Besides this, the farmers will also have the right to sell their produce directly to consumers.

She said the policy has been framed to draw the maximum benefits from the retail revolution sweeping the whole world as this will help to integrate the rural economy with the mainstream economy of the country.

She said that under the new policy only serious investors are welcome having minimum net worth of Rs 500 crore and ready to make an investment of Rs 5,000 crore in next five years in the state.

The investors selected under the policy will be issued a unified licence for procuring agriculture products from across the state. The investor will also have the facility of depositing the Mandi fee at a single point.

The private investor will also be permitted to set up private market yard, sub-market yard, corner market and private market for procuring agriculture produce from the farmers. The investor will also be allowed to set up their retail commercial centres at the place of their choice.

The chief minister said the selection of investors would be made through a totally transparent system and a high level committee would be constituted under the chairmanship of an Infrastructure and Industrial Development Commissioner.

"The committee will provide single-table facility to investors so that all sanctions and licences will be available at a single place," she added.

For the redressal of the disputes, the government will set up dispute disposal committees headed by the district magistrates at the district level and the state level committee will be chaired by the Agriculture Production Commissioner. The chief minister clarified that under the policy the state government will only act as a facilitator and participator with implementing infrastructural facilities such as roads, canals and power so that the investors get a favourable atmosphere.

The policy would have an objective to ensure better and remunerative prices to the farmers of their produce and ensure all round development of the farming sector which will benefit around 120 million farmers of the state, chief minister Mayawati said.

The private investors would not only provide better seeds, fertilisers, and pesticides to the farmers but they will also play an important role in the micro-financing and crop insurance.

Under the policy, the private investors would be encouraged in areas like processing and intermediate activities such as sorting, grading, storage, packing, transportation, distribution and export so that the backward and forward linkage system could be established in the entire set up.

According to the statistics, UP agriculture sector has 90 per cent small or marginal farmers whose economic condition is bad even after high growth rate.

According to 1991-92 statistics, more than 60 per cent rural families have less than one hectare of land. Only 28 per cent rural families have more than one acre of land while 11.24 per cent households are landless.