NCDEX Spot Exchange (Nspot) has signed a joint venture agreement with the State government to put up electronic platforms at the over 150 Agricultural Produce Market Committee (APMC) markets.
The State and Nspot would invest Rs. 5 crore each in the yet-to-be-named joint venture company. The pact was signed on Tuesday in Mumbai.
The State Cabinet recently provided approval for setting up the special purpose vehicle.
The venture would modernise the APMC markets by introducing electronic auctions, providing facility for grading produce, arranging payment to farmers directly. It would also aim to usher in other best international practices adopted in the advanced markets.
The spot exchange has presence in the State and it had tested out each module of the electronic platform in different markets, as a pilot project, Samir Shah, Managing Director, NCDEX, said in a statement.
In the initial phase, major markets and commodities would be covered following which other smaller markets would be included, eventually extending operations to the whole State. The company would also link participants in the State markets to the national market and reduce payment default risk that is common now.
The pilot project was successful and it would be replicated in each one of these markets.
“We expect to cover up to 10 markets by March-end,” Mr. Shah said.
The spot exchange is in talks with Andhra Pradesh, Tamil Nadu, Maharashtra, Rajasthan, Gujarat and Madhya Pradesh to modernise their agriculture markets, he added. After the initial phase, other institutions could be inducted into the company.
While foodgrains and cereals would be the focus of the project initially, fruits and vegetables would be covered in the final phase.
The Karnataka Agricultural Marketing Policy was implemented in September 2013 aiming to bring about farmer-friendly reforms in the field of marketing and help producer-sellers (farmers) secure the best price for their produce through a transparent auction process.
The agreement was signed by C. Somasekhar, Secretary, Co-operation Department, Mr. Shah and Manoj, Additional Secretary (Marketing Reforms). G.V. Krishna Rau, Additional Chief Secretary and Development Commissioner, was present.
