Chapter 12: Progress of regulation
Regulation of markets in India is today a state subject. The directorate of marketing and
inspection at the central level render advice in farming market legislation and its enforcement. In
1938 a model bill was prepared by the central agricultural department (now known as Directorate
of marketing information). On the lines of this bill several states drafted and passed their own
bills. The progress of regulation was very slow due to the 122 markets were regulated till the end
of the war. After independence the planning commission in its 1 and subsequent 5 years plan
emphasis the vital role played by regulated markets. Due to this the number of regulated markets
grew rapidly after independence. The number of the markets increased from 432 in 1950 to 3631
A number of steps have been taken in the last 50 years to regulate markets. These are aimed at
regulating marketing practices, standardizing weight and measures, developing certain
infrastructure facilities in assembling markets and introducing quality standards AGMARK
Though the legal framework has been provided in those state the progress is uneven hence it’s
suggested time and again that:
a. A further expansion of the regulated market system in terms of both market and
commodities to be brought within the scope of regulation.
b. Strengthening the arrangement of enforcement and inspection to ensure a regulated system
of open auction, trading practices and margins of intermediaries.
c. Development of rural markets and shandies and establishment of rural markets in areas
where such facilities are not available.
At the central level financial assistance is being provided to select regulated markets for
establishment of grading facility for some important items at the producers level. Some schemes
are also assisting the development of infrastructure facilities in selected regulated markets both primary and wholesale levels. But despite this the progress is not very satisfactory. Quite a
sizeable size of markets remains unregulated even in this day and time.
Benefits or advantages of regulated markets:
Regulated markets have many advantages over unregulated ones. Economically the producers
gains by way of reduction of unwarranted multiple market charges and unauthorized market
deductions. Socially it profits the producer as he is now directly involved in the management of
the market communities. This provides him with a platform where he can discuss matters
concerning his interest and give bent to his grievances. Psychologically the producer occupies a
dominant position in the market community and faces the trader with greater confidence.
Market the social and economic benefits accruing to the cultivators, as a result of the regulation
of markets may be briefly enumerated as below:
1. As a result of the rationalization of market charges alone, the producer-seller is benefited to
the time of 3-5Rs for every hundred Rupees worth of produce marketed by him in the
regulated markets. It works out to be 15-25lakhs on rupees in respect of markets with an
annual turnover of 5crores of rupees. This is no small benefit to the tiller of the soil. Besides
there has been a reduction in the market charges which varies between 28&69 % inn various
2. There has been an increase in the number of sellers bringing their produce to these
markets. Until 1944, the producers themselves took less than 40% of the produce to the
markets. The average percentage has now gone up to 70%.
3. Markets charges are clearly defined and specified. Excessive charges are reduced and
unwarranted ones are prohibited
4. Market practices are regulated and the undesirable activities of the market functionaries are
brought under control so that a fair dealing is assured 5. Correct weighment is ensured by periodical inspection and verifications of scales and
weights. Only correct and stamped beam scales and weights are allowed to be used in the
6. A machinery for the settlement of disputes between traders and sellers is setup this
machinery provides suitable arrangements for the settlement of disputes regarding quality,
weighment and deduction prevent litigation, safeguard the interest of the seller and
smoothens business by creating good relation between sellers and buyers.
7. Reliable and up to date market news are available to the sellers.
8. Proper market yards with full facilities like sheds for the sale of produce, cart parking
place, better grading and warehousing facilities for accommodation of agricultural produce
are duly provided by the market committees.
9. Open auction methods are strictly followed and unjustified trade deductions like karda,
dalta, batta namuna etc are eliminated.
10. In these markets suitable quality standards and standard terms for buying and selling are
11. Besides reliable statistics of arrivals, stock and prices are easily available.
Thus regulation of markets has been a boon to the agriculturalists. It has not only introduced a
system of competitive buying, helped to eradicate undesirable malpractices, rationalized market
charges, standardized weights and measures, protected cultivators from authorized deductions
and unduly low quotations but has also developed a machinery for serving impartial settlements
of disputes between the practices. Taking the overall picture, regulated markets have produced a
wholesome effect on marketing structure and have generally raised the efficiency of marketing at
the primary level.
Steps have to be taken in the future not only to bring the remaining assembling and terminal
markets but also the primary markets under regulations. 2. The market yard; amenities and facilities:
A market yard is “A statutory declared area situated within the market proper where all
sellers of the notified commodities are supposed to bring them and affect transaction
with licensed traders directly through the other license intermediaries under the
supervision of the employees of