Mumbai: The Maharashtra government on Monday deferred its decision to shift the payment of commission (known as adat) from farmers to traders by 15 days, after commission agents (known as adtas) threatened to boycott auctions of farm produce at the agricultural produce market committees (APMCs) or mandis.

Last Friday, the state government had said agents working in these wholesale markets should recover their 6% commission from traders and not farmers.

In response, the agents threatened to boycott auctions starting Monday. There are 305 APMCs across Maharashtra, which have an annual turnover of around 37,000 crore. Of these, the APMCs of Navi Mumbai, Pune, Lasalgaon in Nashik district and Nagpur are among the largest and rates of agricultural produce in these mandis affect rates of agricultural produce across the state.

“The government is putting a 15-day stay on its own decision and will call a meeting of all stakeholders in first week of the new year before taking a final decision," cooperative and agriculture marketing minister Chandrakant Patil said in the assembly on Monday.

This is not the first time that Maharashtra has tried to shift the onus of commissions to the traders. Similar plans were announced in 1997 and 2006 but put on hold after stiff resistance from commission agents. Gujarat, Andhra Pradesh and 10 other states have already implemented such a change.

“We had not thought this government will be such a meek government who will withdraw its decision after a mere call for boycott by these commission agents," said president of Swabhimani Shetkari Sanghatana and Lok Sabha member Raju Shetti, whose party is supporting the Bharatiya Janata Party-Shiv Sena government in the state.

Shetti refutes the claim made by commission agents that the interests of the farmers will be compromised if they start to work directly with the traders.

“Anyway these adtas work in favour of traders as most traders are their relatives or members of their extended families; so they work to ensure their relatives and family members benefit at the cost of farmers," said Shetti, adding that while the official commission is 6%, farmers ends up paying 10-12% due to illegal charges such as tolai (weighing), bharai (loading-unloading) and market committee cess.

Representatives of the commission agents, however, continue to argue that farmers benefit from their intermediation.

“Adtas not only try to get best possible rate for farmers’ produce but he is bound by law to make payment within 24 hours after receiving goods from the farmer, irrespective of when he receives payment from traders, and most adtas try to bridge this gap in their cash flow by taking loans from banks on which they have to pay the interest. In such circumstances, it will be both ethically and legally wrong to charge commission to traders," said Shivlal Bhosale, president of Maharashtra Rajya Adta Sanghatna, or Maharashtra State Commission Agents Association.

The issue is driven by political motives and has little to do with the benefit of farmers, according to Shetkari Sanghatana leader Girdhari Patil.

“Most of the APMCs are controlled by Nationalist Congress Party and a few by Congress, so the present BJP-Sena government is trying to score brownie points over Congress-NCP by changing rules; but at the same time, the government is trying to work out some compromise with powerful cartel of commission agents and traders," said Patil.

Independent experts add that rather than focus on cosmetic issues like who pays the commission, the government should focus on making the process more transparent.

“The real issue is not adat but the lack of physical infrastructure to carry out auctions of agricultural produce in transparent manner. The farmer never comes to know how rates are decided, who is deciding, who is bidding and in which APMC he will get best possible rate, said Pradeep Apte, professor of economics at Pune’s Fergusson College, adding that the government must concentrate on creating physical infrastructure in 40 big APMCs in the state if not in all 300 APMCs.