The number of Agricultural Produce Market Committees (APMC) in Karnataka could shrink from 162 to 30, officials fear, afer the government freed up farm trading that will lead to a revenue loss of some Rs 600 crore annually. Sources in the cooperation department told DH that the implementation of the new legislation, passed by the Centre, will have an “adverse effect” on 60,000 traders and middlemen dependent on APMCs for livelihood.

“The number of markets will come down to around 30, along with a proportional eect on employment,” a source said. Meanwhile, several companies which used to procure agricultural produce under the terms of Direct Purchase Centre (DPC) licence regulated by the cooperaton department, have now sought cancellation of the same as DPCs will be unnecessary under new law. While such move will have a disastrous eect on APMCs, sources in the department fear that it would also eect the procurement prices fixed for DPCs based on trading at APMCs, apart from paving way for monopoly markets of agro produce.

Eager to make use of the provisions of new APMC legislation, seven firms have sought cancellation of DPC licences “to get away from the regulations - such as minimum support price - mandated under DPC licensing. While the seven are small to medium firms, even large companies have enquired about cancelling the licences,” the sources added. When contacted, Cooperation Minister S T Somashekar said that anyone willing procure produce need not apply for a licence nor register with the department.

“Deputy commissioner and assistant commissioners of the district will be the regulatory authority,” he said, adding that anyone with a PAN card can procure crops. On the new legislation’s eect on price-fixing mechanism, he said that the state would continue to insist on procuring goods based on the average price of in APMC yards.

“There will be no problem for farmers with regard to price,” he said. Change in legislation also forced the government to reduce market fee for APMCs, as Centre levied zero per cent market fee for new DPCs. The state government, due to pressure from farmer groups, reduced market fee of APMCs from 1.5% to 0.35%. Sources added that it would hit the revenue of APMC department by Rs 500-600 crore.

The department generated around Rs 618 crore last year and around Rs 590 crore in 2018-19. Due to the new fees, the department will shore up only Rs 120 cr, seriously aecting the maintenance of APMCs, sources said.