- E-NAM (National Agriculture Market) is an online trading platform for agriculture produce aiming to help farmers, traders, and buyers with online trading and getting a better price by smooth marketing.
- Small Farmers Agribusiness Consortium (SFAC) is the lead agency for implementing eNAM under the aegis of Ministry of Agriculture and Farmers’ Welfare, Government of India.
Why do we need it?
- Administration of agriculture marketing is carried out by respective states.
- Each state has its own APMC Act, with varied provisions.
- The lack of uniformity and compatibility has led to the fragmentation of agricultural markets, where each state functions as a separate market.
- Every state is further divided into several market areas. These separate areas formed will be administered by a separate Agricultural Produce Marketing Committee (APMC), which imposes its own marketing regulation.
- This fragmentation of markets even within the state level hinders the free flow of agri-commodities between different markets.
- Multiple handling of agri-produce and multiple levels of mandi charges lead to escalated price for the consumers without equivalent benefits for the farmers.
- These challenges are addressed by e-NAM by creating a unified market via online trading platform both at the state and at the national level.
- For seamless operations, e-NAM mandates three changes in the agricultural marketing laws of states.
- This include:
- Provide for electronic trading.
- Provide single trading licences that are valid in all mandis in a state
- Provide a single-window levy of transaction fees
- Only the states/UTs that have completed these prerequisites will be eligible for assistance under this scheme.
- Also, the State Marketing Boards/APMCs must enable the promotion of e-auction platform.
Salient Features of eNAM
- eNAM portal will enable farmers to showcase their products through their nearby markets and facilitate traders from anywhere to quote price.
- e-NAM provides single window services for all Agricultural Produce Market Committee (APMC) related services and information. This includes commodity arrivals, quality & prices, buy & sell offers & e-payment settlement directly into farmers account, among other services.
- Using the eNAM service, license for the trader, buyers and commission agents can be obtained from the state-level authorities without any pre-condition of physical presence or possession of shop or premises in the market yard.
- Harmonisation of quality standards of agricultural products and infrastructure for quality testing is made available in every market. Recently, common tradable parameters have been developed for 25 commodities.
Benefits of Trading on eNAM
- Transparent Online Trading
- Real-Time Price Discovery
- Better Price Realization For Producers
- Reduced Transaction Cost For Buyers
- Stable Price and Availability to Consumers
- Quality Certification, Warehousing, and Logistics
- More Efficient Supply Chain
- Payment and Delivery Guarantee
- Error Free Reporting of Transactions
- Enhanced Accessibility to the Market
What are new features added to e-NAM?
- The government has recently launched new features in the e-NAM platform to strengthen agriculture marketing by farmers to reduce their need to physically come to wholesale mandis for selling their harvested produce
- These reforms come amid the increasing need to decongest mandis to effectively fight against COVID-19.
- The two new features are as follows: Warehouse-based trading modules in e-NAM software will enable trade from warehouses according to e-NWR (electronic negotiable warehouse receipt)
- Farmers Producers Organisations (FPOs) trading module in e-NAM enables FPOs to trade their produce from their collection centres without bringing the produce to APMC.
- These new features make it more convenient for the farmers to sell their produce at warehouses and collection centres established by farmer producer organisations (FPOs).
- Warehouses that are accredited by the Warehousing Development and Regulatory Authorities are the only ones eligible to provide the trading services once the states notify them as deemed markets.
- This additional option would help farmers to access the e-NAM platform via the warehouses as they can keep their produce and sell it later when the prices will be higher since storage cost is low.
- Even small farmers can easily take loans against e-NWRs, generally up to 75% of the value of crops, at a concessional interest rate of 7% to meet their immediate needs.
- Also, the FPOs trading module will help these FPOs to upload their produce from their premises/collection centres for bidding
Allocation of Funds
The Cabinet Committee on Economic Affairs had designated a Scheme for Promotion of National National Agricultural Market through Agri-Tech Infrastructure Fund (ATIF).
What can be the way forward?
- The government should also ensure that farmers adopt this mechanism and do away with their traditional interactions with the traders.
- Startups should be allowed to test the quality of the produce. They should get paid at a fixed fee.
- The government can also ensure the development of a network of cost-effective assaying facilities in agricultural markets across the country for all commodities.
- The e-NAM mechanism should include state-of-the-art technologies to enable quick and accurate assaying at a reasonable cost. Assaying should be made mandatory for transactions under e-NAM.
- It is necessary to ensure that e-NAM/APMC markets have appropriate storage facilities to provide cost-effective warehousing facilities to farmers to avert distress sale.
- Private players can be invited to build more warehouses at the site of mandis.
- Electronic payments should be adopted so that farmers get prompt payment from their produce.
- An institution should be established to support inter-mandi trade and movement of produce. This institution should also be involved in dispute resolution.
- Auction of the produce should take place simultaneously on one common electronic platform in all APMC markets in the country, as well as in the private market. There should be a regular flow of information on prices and trades executed on e-NAM so that integration of the market is achieved.
