India is a unique economy where a large part of it is driven by agriculture, but it is largely unorganized. To bring organization to this primary sector, the India government has initiated ENam which is an online platform that eliminates middlemen and ushers in transparency for the farmer.
Under the National Agriculture Market scheme (NAM), ENam has been launched to create a unified national market for agricultural commodities by integrating Agriculture Produce Marketing Committees or APMCs across states in India.
The numbers have been ambitious from the get-go. The targets include: a) ENam should be deployed in selected 585 regulated wholesale markets in States/UTs desirous of joining the e-platform; b) 400 mandis will be integrated by March 2017 and c) integrate the remaining 185 by mandis by March 2018. The good news is that the platform currently lists 23 commodities and integrates 21 agricultural markets across eight Indian states.
However, if one delves deeper, the reality offers a strikingly different image.
Some challenges with eNAM
The multilingual e-trading portal for farmers comes with features like MIS dashboard, BHIM and other mobile payment facilities, enhanced features on mobile app such as gate entry and payment via mobiles. The vision is great, but I’d have to admit that it has been a bit disappointing to know that only 4.5 million farmers have registered on this platform as compared to the 130 million total engaged in farming in India.
The root cause, from what I have observed, can be pointed to the following:
- Incomplete APMC Act enactment: Each regional state has to amend its APMC Act to make a provision for electronic auction as a mode of price discovery, allow a single licence across the State and have market fees levied at a single point. Only 13 States have enacted the necessary amendments.
- Lack of digital infrastructure: The ENam proliferation efforts are thwarted by lack of internet connectivity, scientific sorting/grading facilities or quality testing machines. In real-time the Maha Farmers Producer Company, the federation of FPCs in Maharashtra was unable to trade on the eNAM platform in Latur, one of the largest markets for pulses in the country.
- Agents vs. Farmers: Though electronically, efforts have been to integrate mandis onto the platform, some high-business mandis were still led by agents and not the farmers. Even in some of the best and most recognized mandis, farmers were unable to sell their produce.
All these reasons cumulatively, have slowed down the adoption and intended functioning of eNAM.
While the adoption has been marred by the above-mentioned road-blocks, it is expected in a complex economy such as ours. The solution to the adoption problem would lie in:
- Laying down a more robust digital infrastructure should solve half of the problem.
- Relentless education of the farmers in the platform and benefits perhaps solves most of remaining half of the problem. Mind you, this will be one long and arduous journey.
- We’d need to work to reduce the middlemen registered with eNAM. Without this, the purpose of providing “direct” access gets defeated. What mechanisms can be brought in to keep middlemen in check?
From our experience with 24 Mantra, transparency and traceability lead to improved farmer lives and agriculture. I hope eNAM will have a similar, but significantly more widespread impact.