Large farm lobbies are backing the government’s decision to allow foreign supermarkets to set up shop in the country, saying it will shorten the supply chain and get growers a larger share of the final selling price. Most farmers, however, want the government to go a step further and make it mandatory for retailers to buy 75% of their produce directly from farmers, bypassing the restrictive ‘mandi’ auction system. India has 600 million farmers, 1,200 million consumers and 5 million traders. Both farmers and consumers are benefited by FDI in retail. Last week, the government allowed 51% foreign direct investment (FDI) in multibrand retail and also raised FDI limit in single-brand retail to 100%. The move, however,stirred up political dissent with parties such as the BJP, CPI(M) and TMC demanding the government drop its plan as it would cost millions of jobs. But big farmers are all for retail reforms. Bharat Krishak Samaj, a farm lobby with more than 75,000 members, said it supports FDI in retail on the condition that direct procurement from farmers is made mandatory. Farmer leaders say the stranglehold of middlemen and traders is at the root of rural poverty and India’s food inflation. What a farmer sells for Rs. 1 is sold at the mandi at Rs. 2, which becomes Rs. 3 at the mandi at the consumption centre and Rs. 4 when it reaches the consumer through a retailer. Farmers near urban areas are already finding ways to circumvent the mandi system and reach the consumer directly. For instance, 23-year-old farmer S Chandrasekhar drives 10 km every Sunday to sell fresh vegetables to joggers and walkers on Chennai’s Besant Nagar beach. Some 1,160 km away, Shriram Gadhave, president of All India Vegetable Growers Association, organises buyer-seller meets at Thane and surrounding areas to facilitate better price recovery.
Anna Hazare opposes FDI in Retail.
No comments:
Post a Comment