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Rajasthan regulates direct purchase of commodities

Now private agro companies like ITC, Cargill, Australian Wheat Board will have to cough up more money for the direct purchase of commodities in Rajasthan.

, ET Bureau|
Jan 15, 2010, 06.11 PM IST
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JAIPUR: Now private agro companies like ITC, Cargill, Australian Wheat Board will have to cough up more money for the direct purchase of commodities in Rajasthan. The state government has amended Agriculture Produce Marketing Council (APMC) Act to regulate the direct purchase from farmers. (Watch)

Private companies and food processors will have to give an undertaking of guaranteed purchase of notified agri commodities outside the market yard.

Rajasthan Agriculture Marketing Board director GP Shukla told ET that the companies would have to guarantee minimum offtake of 2000 tonnes of the notified commodity before obtaining the purchase license from the concerned market.

“Companies will have to submit security deposit or collateral equivalent to minimum one day sale of the notified commodity. In case of any default in payment, the security deposit can be used to settle farmers’ dues.

However, public sector companies would be exempted from this,” he said.

Earlier companies used to get purchase licence on payment of only Rs 10,000. “Now the net worth of the company or the trader has to be Rs 1 crore for direct purchase. Apart from that companies will have to install electronic weighing machine and provide other basic amenities for the farmers at purchase centres. Moreover companies would not be allowed to purchase commodities below support price,” he said.

The government is also planning to introduce single license system in the state, which would enable companies or traders to operate across the markets in the state.

“Rajasthan has 125 notified markets. Companies have to take individual license for every market. With this, companies can operate across the state. This will simplify the purchase process,” he said.
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