Prime Minister Narendra Modi’s road building scheme for rural India could also hold a key towards uplifting farm economy. Under the third phase of PMGSY (Pradhan Mantri Gram Sadak Yojana), the government has made it conditional for the release of funds that the state governments first undertake reforms to their respective Agriculture Produce Marketing Committee (APMC) laws.
“The states adopting reforms in line with the Union Agriculture Ministry-drafted Model Agricultural Produce and Livestock Marketing (Promotion & Facilitation) Act of 2017 “shall be accorded priority in PMGSY-III”, The Indian Express cited a supplementary note for a Cabinet Committee on Economic Affairs meet which was held in July last year.
The rationale behind this move is that the government must leverage PMGSY for farm reforms. The prioritization of the state government which implement farm reforms first and get funds under PMGSY phase three was at the behest of PM Modi himself, according to official sources. “His whole point was that when the Centre is giving so much money (the implementation period for PMGSY-III is from 2019-20 to 2024-25), why not use this opportunity to also push agriculture market reforms and allow farmers to sell to anybody and anywhere (as against the current system, where their crop can be brought to and purchased only from regulated APMC mandis)?”, The Indian Express cited sources as saying.
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Finance Minister Nirmala Sitharaman in her budget announcement said that the centre will “encourage” state governments if they implement reforms based on its earlier released “model laws” relating to agriculture produce marketing. The Fifteenth Finance Commission’s first report for the current financial year 2020-21 also contained a clue as to the government’s plan for agriculture reforms. The states must be given financial incentives “if they enact and implement all features of” model laws, the report says, the newspaper reported. However, the government already has a plan in action for linking grants-in-aid with agriculture reforms under PMGSY.
The third phase of the PMGSY was cleared in July 2019. Under the third phase, regions which already have PMGSY road will be further enabled by connecting them with nearest APMC (agricultural produce market committee) mandi or GrAM (Gramin Agricultural Market). The government expects that the same will ramp up about 1,25,000 km of rural roads and spur faster movement of produce from rural areas.
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Source ( Financial Express)