Details

Technical Note

Educator Copy

AGRICULTURAL PRODUCE MARKETS IN PUNJAB

M. Ahsan Rana


INDUSTRY : Agriculture

AREA : Business Government/International Economy

ORGANIZATION :

LENGTH : 34

LUMS No : 13-106-2018-2

PUBLICATION YEAR : 2018

DESCRIPTION

KEYWORDS:

Agricultural Produce Markets; Commission Agents (Arhtis); Legal and Institutional Reform


DESCRIPTION:

Whether or not the farmer gets a fair price for his produce depends significantly on the effectiveness of the legal and institutional frameworks for marketing of agricultural produce. Unfortunately, the legal framework is archaic and restrictive, and the institutional framework is inadequate. Developed several decades ago, they have not evolved with the changing context. Consequently, farmers are short-changed in a thoroughly rigged market. Since the law restricts bulk sales and purchases from notified markets and through licensed agents, this is nothing less than ‘state coercion’ that restricts farmers’ marketing choices. Further, provincial and local institutions are miserably failing in performing their essential functions. Therefore, markets have become too crowded and messy for farmers to sell their produce without engaging with a number of mediators, each of whom receives his pound of flesh. In gross violation of the spirit of the existing law, market governance has been entrusted to politically appoint administrators whose claim to this position of responsibility is far from obvious. Arhti – a market operative working for a commission – emerges as the lynchpin of the system who manipulates it for personal advantage. This note is a critical examination of the legal and institutional framework for agricultural produce markets in Punjab.


LEARNING OBJECTIVES:

This note will be used as the prescribed reading for 1.5 classes in the undergraduate course: Rethinking Policy – Critical Perspectives on Pakistan’s Agricultural Development (MGMT 362). The objective is to provide students with a comprehensive overview of agricultural produce markets in Punjab. In one session (75 minutes), the institutional framework will be covered, in particular, the role of MCs and Arhtis. In a (preceding) half session, the evolution of the legal framework will be studied to argue how dissonance between the market and the law can be stifling for the former. To understand why a law is what it is, it is essential to examine how it has evolved. The note will also be used in the ECAM program spread over 1.5-2 sessions.


SUBJECTS COVERED:

Public Policy