Agricultural Marketing in North East India:
Prospects and Problems
North East India comprising of seven states, also called the Seven Sisters, is a small
but significant part of India squeezed between Nepal and Bangladesh. The seven states -
Arunachal Pradesh, Assam, Manipur, Meghalaya, Mizoram, Nagaland, Sikkim and Tripura –
id connected to the rest of the country through the Siliguri Corridor of 21 to 40 kms in West
Bengal. The region shares more than 4,500 kilometres (2,800 mi) of international border
(about 90 per cent of its entire border area) with China (South Tibet) in the north, Myanmar
in the east, Bangladesh in the southwest, and Bhutan to the northwest. In terms of
geographical size, Northeast India constitutes about 8% of the total India's size and its
population is approximately 40 million (2011 census), which represents 3.1% of the total
Indian population (1,210 million). The Northeast region can be physiographically categorised
into the Eastern Himalayas, Northeast Hills (Patkai-Naga Hills and Lushai Hills) and the
Brahmaputra and the Barak Valley Plains. Northeast India (at the confluence of Indo-
Malayan, Indo-Chinese, and Indian bio-geographical realms) has a predominantly humid
sub-tropical climate with hot, humid summers, severe monsoons and mild winters. Along
with the west coast of India, this region has some of the Indian sub-continent's last
remaining rain forests which supports diverse flora and fauna and several crop species.
Similarly, reserves of petroleum and natural gas in the region constitute a fifth of India's total
potential. The region is covered by the mighty Brahmaputra-Barak river systems and their
tributaries. Geographically, apart from the Brahmaputra, Barak and Imphal valleys and some
flat lands in between the hills of Meghalaya and Tripura, the remaining two-thirds of the area
is hilly terrain interspersed with valleys and plains; the altitude varies from almost sea-level
to over 7,000 metres (23,000 ft) above MSL (Wikipedia, 2014a).
And all these factors ultimately affect directly or indirectly the livelihood of the people which
is intricately inter-wined with marketing facilities. All the increase in production and
productivity is no good to the farmers if they cannot sell their produce in the market at a fair
price. But to understand the marketing structure of North East India better, an overview of its
agriculture and related infrastructure will help us get a better picture of the socio-economic
condition of this part of the country.
A) Agriculture in North East India: Present status
The economy of North East India is basically agrarian. Along with settled agriculture, jhum
(shifting cultivation) is still practised by a few indigenous groups of people. The inaccessible
terrain and internal disturbances has made rapid industrialisation difficult in the region. The
pattern of agricultural growth has however remained uneven across regions and crops. The
NER continues to be a net importer of food grains even for its own consumption. In spite of
covering 7.7% of the country’s total geographical area, NER produces only 1.5 % of the
country’s total food grain production. Agriculture provides livelihood support to 70 % of the
population of NER (NEDFi, 2014a).
Because of structural and topographical constraints and also the livelihood pattern of the
farmers of North East India, agriculture is still laid back and barely sufficient for livelihood. A
large gap exists between the production and productivity of major agricultural crops in the
region compared to the rest of the country. The following figures depict the area, production
and productivity of agricultural crops in both NER and India as a whole.
Fig 1. Area and production of food grains in NER
3910 3893 3894 3741 3767 3588 3729
3873 3889 4067
6043 5932 6083 5706 5718
Fig. 2. Area and production of food grains in India
Fig. 3. Area, production and productivity of pulses in NER
188 178.8 187 175.7 174.8 183.6 198.6 195.3 199.7
124 118 128 116 136 142 142 143 143
881 864 852 865 844
2001-02 2002-03 2003-04 2004-05 2005-06 2006-07 2007-08 2008-09 2009-10
Fig. 4. Area, production and productivity of pulses in India
Pulses are consumed as Dal, which is a cheap source of plant protein. Some pulse crops
like Gram, Lobia, Urdbean & Moongbean are fed to animals as green fodder. Moong plants
are also used as green manure which improves soil health and adds nutrient into the soil
(Farmers’ Portal, 2014). North East plain zone is one of the important pulse growing area of
the country and as it can be seen from Fig. 3 and 4, productivity of pulses is much higher in
North East India compared to the country average.
Fig. 5. Area, production and productivity of vegetables in NER
The area under vegetables has been more or less constant over the years in North east
India and the yield obtained is also basically very low.
23458 22763 22391 23191 23633
14198 14761 14566 14661
544 607 543 635 577 597 612 625 659 625
329.3 383.1 468.2 474.5 382.3
7.1 7.86 9.51 9.61 8.52
1991-92 2001-02 2006-07 2007-08 2008-09
Area ('000 ha)
Production ('000 MT)
Table 1. Area and production of oilseeds in NER and India
2001-02 2002-03 2003-04 2004-05 2005-06 2006-07 2007-08 2008-09
456 452 452 454 434 402 431 431
259 274 258 280.1 222.6 240.7 251.3 260.1
20662 14838 25290 243535 27977.5 24289 29755 27719
(Source: NEDFi, 2014b)
While the average productivity of oilseeds, which is the second most important agricultural
crop in India after foodgrains, in North East India has been 603 kg/ ha on an average, overall
productivity of oilseeds in the country in 2011-12 was 1133 kg/ha. This shows the huge
difference between productivity of oilseed crops in the region (DAC, 2013).
The diverse agro-climatic situations in the region offer excellent scope for growing different
horticultural crop groups like fruits, vegetables, spices, plantation crops, medicinal and
aromatic plants. A wide range of tropical, sub-tropical and temperate fruits such as lemon,
mandarin, pineapple, passion fruit, banana, ginger, turmeric, and vegetables, both
indigenous and exotic, are grown in the region. In terms of its contribution to the national
production, the region accounts for about 5.1% fruits production of the country (North East
Mega Food Park, 2014).
Fig. 6. Area and production of fruits in NER
B) Infrastructural facilities in NE India:
249 270 287 287 238 287 294 293
553 578 598
1871.6 1954 2079 2146
1926 1866 1963
Area ('000 ha)
The process of development had been rather slow in the North Eastern region for many
reasons. The traditional system of self-governance and social customs of livelihood in the
NER had remained virtually untouched during the British rule. Creation of rail network for tea
growing areas for commercial interests was, perhaps, the only major economic activity in the
region. This was coupled with extraction of Petroleum and some Coal Mining in the Assam,
Meghalaya and Nagaland belt. Partition of the country in 1947 which carved out Bangladesh,
hitherto East Bengal, completely isolated the North Eastern region save a slender chicken's
neck leading to severe distortion in the socio-economic situation. In effect, the market and
the centres of production got separated by a political dividing line which had severe
economic repercussion on the livelihood of people along the entire Bangladesh border. All
the produce from agriculture and allied activities had hitherto ready-made markets in
Bangladesh, which got cut-off. The physical infrastructures that mostly affect agriculture and
allied activities related income of this region includes roads, irrigation, cold storages and
market infrastructure which together hold the key for growth of this region.
i) Roads: Roads are the underlying foundations for the entire economic development of
the North East. The region, for geographic and sometimes strategic reasons has very
thin railway network and air service cannot be the means to take care of the humungous
transport needs of even one state, leave alone eight states. Thus how the road network
shapes up is more than an integral part of the story of the development of the region, it
is also a very key index.
Table 2. Total length of road constructed from 20005-06 to 2009-10
2005-06 2006-07 2007-08 2008-09 2009-10
Under PMGSY (km) 1698 2593 2539 3575 22081
Under Bharat Nirman (km) 1421 2520 2098 2972 2193
Total 3119 5113 4637 6547 24273
(Source: NEDFi, 2014c)
India has one of the largest road networks in the world, aggregating to 4.7 million kilometres
as of 2011 and consists of Expressways, National Highways, State Highways, Major District
Roads, Other District Roads and Village Roads. Half the network is not paved and the
National Highways account for only 2.0 per cent of the total length and 40 per cent of the
total traffic (Planning Commission, 2011). The important component of infrastructure
necessary for growth of agricultural marketing is communication/ transport which is utterly
deficient. Almost 58% of the villages in the region do not have proper link roads. According
to an estimate, 88% of the total arrivals in selected primary markets in Manipur, 70% in
Meghalaya, 56% in Assam and 48% in Mizoram are carried on head load by the producers.
The average distance covered varies from 5-10 KM (Meghalaya State Agricultural Marketing
Portal, 2014). Road transport is the primary mode of transport from the producer’s yard to
the primary, secondary and terminal markets but North East India forms only a minute part of
the road network of India which is again with very less maintenance which takes a toll on the
economic activities of the region considering it is the most important means of transportation
and connectivity in the region.
ii) Market infrastructure: Agricultural Marketing continues to be the mainstay of life for
majority of the Indian population. It contributes around 25% of the GDP and employs
65% of the workforce in the country. The Government of India under the ministry of
agriculture has also set up specific commodity Boards and export promotion council for
monitoring and boosting the production, consumption, marketing and export of various
agricultural commodities. The government also promotes organised marketing of
agricultural commodities in the country through a network of regulated markets.
Regulated markets and market yard: Government organized marketing of agriculture
in the country through the network of regulated markets established under the
provisions of the Agricultural Produce Market Act enacted by the states and union
territories. The regulated markets have helped in mitigating the market handicaps of
producer’s sellers. These have also provided physical facilities and institutional
environment to the wholesalers commission agents, traders and other functionaries for
conducting marketing activities. Of the eight states in North East India, Manipur and
Mizoram have not passed APMC Act yet and so market regulation does not exist in
Rural marketing is largely unorganized in the region and dominated by the private
traders. The north-eastern states have high production of fruits, spices and cashew in
the recent past but could not fetch market price equivalent to the other states. Major
share of marketable surplus finds its outlet in the poorly equipped markets held
periodically in the villages. The existing marketing system is three-tier as in other parts
of the country. The primary markets are held periodically at village level, wholesale
assembling markets at block level and terminal markets located at towns and at the
places from where the goods could be transported. Marketing of agricultural
commodities in the north-eastern states, by and large, is dominated by the private
traders due to the absence of proper implementation of market regulation act by the
state agricultural marketing boards
Table 3. Number of agricultural markets in North East India
No. of wholesale
No. of rural
No. of regulated
No. of sub
2001 2011 2001 2011 2001 2011 2001 2011
- 6 50 63 - 129 - 113
2 Assam 172 405 650 735 16 226 19 206
3 Manipur 20 20 49 98 APMC Act not
4 Meghalaya 5 35 82 84 2 2 - -
5 Mizoram 8 10 35 105 APMC Act not
6 Nagaland 16 19 80 174 - 18 - -
7 Sikkim - 7 - 12 - 1 - -
8 Tripura 19 84 321 554 21 21 - -
Total 240 586 1276 1825 39 397 19 319
India 6539 21238 7246 4813
(Source: Meghalaya State Agricultural Marketing Portal, 2014; CSO, 2011)
As we can see from Table 3, in the last decade, there has been a very high growth in
the number of markets in the region and this growth has been especially boosted by
market regulation and establishment of market infrastructure in rural areas especially. In
most of the states the governments have taken initiative in establishing pucca market
yards but bringing the farmers to the yards still remain a good challenge as they still
prefer to sell the produce at farm gate at minimum price to the middlemen and transport
is again a major reason for that.
Growth of market after establishment of APMC: Government organized the sale,
storage and marketing of agricultural produce for each state through the network of
regulated markets established under the provisions of the Agricultural Produce Market
Act enacted by the states and union territories. The markets covered under APMC have
been brought under the ambit of the regulation. The regulated markets have helped in
mitigating the market handicaps of producer’s sellers. These have also provided
physical facilities and institutional environment to the wholesalers commission agents.
Regulated markets attract the farmers and buyers creating competitive trade
environment thereby offering best of prices to the producer- sellers.
iii) Agricultural Research Institute with respect to marketing: National Institute of
Agricultural Marketing (NIAM) is a premier national level institute set up by the Ministry
of Agriculture, of India to cater to the needs of agricultural marketing personnel in India
and South East Asian countries. NIAM was established on 8 August 1988 at Jaipur,
Rajasthan, as an autonomous body set up as a registered society. The institute is
dedicated to Chaudhary Charan Singh, the fifth prime minister of India from where it
derives its full name, the Chaudhary Charan Singh National Institute of Agricultural
NIAM should be the nodal agency for implementation of training, extension and
research programmes in agricultural marketing. NIAM imparts training to various level
functionaries in the thrust areas identified in the field of agricultural marketing for client
organization. The training is imparted to senior and middle level executives of
agricultural and horticultural departments, agro- industrial corporation, apex level
cooperatives, commodity boards and commercial banks. Besides these target clients,
the institute also has a mandate to reach out to farmers to impart training on
management. The institute conducts long-term and short-term research on the various
issues of agricultural marketing and allied discipline. NIAM has been engaged in
preparing development proposals and providing required consultancy services for
institutions and corporations dealing with agricultural marketing. NIAM offers a two-year
PGDM (ABM) (AICTE approved) program for students with graduation and post-
graduation in agriculture and allied sciences.
iv) Agro Industries in North East Region: The economy of North- East India has got its
definite identity due to its peculiar physical, economic and socio-cultural characteristics.
This region consists of eight states viz., Assam, Arunachal Pradesh, Manipur,
Meghalaya, Mizoram, Nagaland, Tripura, Sikkim. There are differences among the eight
States in the North Eastern region with respect to their resource endowments, level of
industrialisation as well as infrastructural facilities. Industrially, the NER continues to be
the most backward region in the country, and the states in the region hardly have any
industrial base, except perhaps Assam, because of its traditional tea, oil and wood
based industries .To some extent Meghalaya has made some headway in setting up of
small and medium industries. Agro-based industries it includes tea industry, sugar
industry, grain mill products industry (rice, oil and flour mills), food processing industry
and textile industry. Some of industries in north east india are:
1. Tea Industry: Tea being an agricultural plantation crop and a major revenue
generator, it plays a vital role in improving the socio-economic condition of the States
of North Eastern Region of India. Assam and Tripura are the traditional tea growing
areas in this region. Assam is the largest producer of tea in India. Some effort has
been made in the recent past to introduce tea in all the other North Eastern States viz
Arunachal Pradesh, Manipur, Meghalaya, Mizoram, Nagaland and Sikkim. Assam
accounts for nearly 53% of the all India production and 69% of North Indian
2. Oil Industry: Assam is the first state in the country where in 1889 oil was struck at
Digboi Assam can boast of oldest oil refinery in the country (set up at Digboi) in 1901.
The refinery, now belonging to the Assam Division of the Indian Oil Corporation, has
a refining capacity of 3 lakh tonnes of petrol, kerosene, diesel and other petroleum
products. Assam has the oldest and the longest cross country crude oil pipeline
(about 1148 km). It is endowed with oil shale reserves, estimated at 137 billion
tonnes with a recovery factor of 20.35%, which is capable of sustaining its crude oil
production in the years to come. It also has a significant reserve of low ash high
sulphur coal. Oil Exploration in Assam has the highest success ratio in the world.
Assam also accounts for one of the biggest pool of professional and skilled
manpower engaged in the oil and petroleum industry.
3. Tourism industry: The North Eastern part of India is almost another world. It is a
place of magical beauty and bewildering diversity. It is a land, where exotic wildlife
exist in the jungles, where flow rivers like the Bramhaputra, the Barak and the Imphal
and where the hills are full of breathtaking landscapes.With more than a hundred and
fifty tribes speaking as many languages, this region is a melting pot of variegated
cultural mosaic of people and races, an ethnic tapestry of many hues and shades.
The folk culture is still vital in this region. Well integrated with life and nature, the folk
artworks have a common element of tune and tone. It is a tourists’ delight.
4. Silk industry: Sericulture is also a very important agro-based industry and in
developing countries like India, a high priority is being accorded to this sector
because of its employment potential, particularly in the rural and semi-urban parts of
the country.Sericulture has an important role in the economic profile of many of the
North Eastern states. Some of the states, which have accorded a fairly high priority to
sericulture and silk weaving, include Assam, Manipur and Mizoram. Assam is the
most important silk producing state in the North Eastern Region. .Assam has got a
suitable climate and environment for practising sericulture.
v) Information sources: A number of initiatives by governments aim to provide market
price services, driven by the view that greater price transparency is a public good. Price
has been disseminated in many ways—chalked on notice boards, broadcast by local
radio stations, published in newspapers, and (more recently) posted on websites. The
information on these websites is confined mainly to product standards and specifications
as well as market studies—particularly of external markets but increasingly of local
value chains—including databases of contacts such as buyers, traders, agricultural
processors, and input suppliers. For market information, farmers rely very little on the
Internet but turn to multiple other sources, including farmer organizations, other farmers,
newspapers, radio, TV, and short messaging service (SMS) and voice services. A few
trader also depended on APMC bulletins, agricultural magazines and announcement by
APMC, district information office and district statistical officer on daily basis whereas, the
annual reports are being circulated to the Zilla Panchayat, agricultural research stations,
deputy commissioner and state marketing board.
vi) Commodity boards in North East Region: The commodity boards function under the
purview of ministry of commerce, government of india. This commodity boards are
mainly confined to plantation and commercial crops in india. The different types of
commodity boards established in india are, tea board, rubber board, coffee board,
spices board, tobacco board, coir board, silk board. Given below are the commodity
offices in north east region.
1. Tea board:
a) Guwahati – assistant director of tea development, north eastern zonal office
b) Silchar – assistant director of tea development, tea board
c) Jorhat – executive director of tea development (plantation), tea board, tea research
d) Itanagar – assistant director tea development tea board, regional office.
e) Agartala – assiatant director of tea development, tea board, regional office
f) Tezpur – assistant director of tea development tea board.
2. Rubber board:
a) Dimapur - Rubber Board Regional Office - Development Officer
b) Agartala - Rubber Board Regional Office -Deputy Rubber Production Commissioner
c) Dharmanagar - Rubber Board Regional Office - Deputy Rubber Production
d) Jorhat - Rubber Board Regional Office -Development Officer commissioner
e) Silchar - Rubber Board Regional Office - Development Officer
f) Tura - Rubber Board Regional Office - Development Officer
g) Guwahati - Rubber Board Regional Office - Deputy Rubber Production
3. Coffee board:
a) Assam - Regional Coffee Research station, Diphu - 782 460, Karbi Anglong District
4. Spices board:
Regional offices at Tripura, Mizoram, Manipur, Nagaland, Sikkim, Assam, Arunachal
vii) Minimum Support Price: The Commission for Agricultural Costs & Prices (CACP since
1985, earlier named as Agricultural Prices Commission) came into existence in January
1965. Currently, the Commission comprises a Chairman, Member Secretary, one
Member (Official) and two Members (Non-Official). The non-official members are
representatives of the farming community and usually have an active association with
the farming community. The price policy for agricultural commodities is an integral part
of India’s overall agricultural policy. The MSP for important cereals, pulses, oilseeds,
and other commercial crops, namely, cotton, jute and sugarcane, are fixed by the
Government every year on the basis of the recommendations made by the CACP. One
of the important factors considered by the CACP in making its recommendations on
MSPs for different crops is the cost of cultivation/production. An analysis of various price
policy issues in the emerging socio-economic environment requires advance information
on the production of different crops, the supply-demand scenario, and regular
monitoring of price movements in both the domestic and international markets. An
agency has been established in the North Eastern states of Nagaland, Sikkim,
Arunachal Pradesh and Tripura for generating estimates of area and production of
principal crops and land-use statistics, through complete enumeration of 20 per cent of
the villages every year and the conduct of crop-cutting experiments which is used in
determining the MSPs. MSPs of some of the important agricultural crops grown in North
East are given in Table 4.
Table 4. MSPs of some important crops grown in North East India
Commodity Year and MSPs(in Rs.)
2007-08 2008-09 2009-10 2010-11 2011-12 2012-13 2013-14
Paddy common 645 850 1000 1000 1080 1250 1310
Paddy 675 880 1030 1030 1110 1280 1345
Maize 620 840 840 880 980 1175 1310
Arhar 1550 2000 2300 3000 3200 3850 4300
Moong 1700 2520 2520 2900 3300 4300 4300
Groundnut 1500 2100 2100 2300 2700 3700 4000
Sesamum 1580 2750 2850 2900 3400 4200 4500
Soybean Black 910 1350 1350 1400 1650 2200 2500
Soybean Yellow 1050 1390 1390 1400 1690 2240 2650
Wheat 750 1000 1050 1100 1120 1285 1350
Gram 1445 1660 1730 1760 2100 2800 3000
Lentil 1545 1700 1870 1870 2250 2800 3000
1715 1800 1830 1830 1850 2500 3000
(Source: DMI, 2014)
Problem and prospects in Agricultural Marketing
There are several challenges involved in marketing of agricultural produce. There is limited
access to the market information, literacy level among the farmers is low, multiple channels
of distribution that eats away the pockets of both farmers and consumers. The government
funding of farmers is still at nascent stage and most of the small farmers still depend on the
local moneylenders who are leeches and charge high rate of interest. There are too many
vultures that eat away the benefits that the farmers are supposed to get. Although we say
that technology have improved but it has not gone to the rural levels as it is confined to
urban areas alone. There are several loopholes in the present legislation and there is no
organized and regulated marketing system for marketing the agricultural produce. The
farmers have to face so many hardships and have to overcome several hurdles to get fair
and just price for their sweat.
The globalization has brought drastic changes in India across all sectors and it is more so on
agriculture, farmers and made a deep impact on agricultural marketing. It is basically
because of majority of Indians are farmers. It has brought several challenges and threats like
uncertainty, turbulence, competitiveness, apart from compelling them to adapt to changes
arising out of technologies. If it is the dark cloud there is silver lining like having excellent
export opportunities for our agricultural products to the outside world.
Agricultural Market Reforms
Below are the certain measures that can be affected to bring out the reforms in agricultural
marketing so as to ensure just and fair price for the farming community.
• Provide loans to the farmer at low rate of interest so that they will be freed from the
clutches of local moneylenders who squeeze them.
• It is essential to provide subsidized power supply and loans to the farmers as the expenses
towards power consumption takes considerable amount of investments.
• Generate a new distribution network that connects the farmers directly to the consumers to
get maximum returns
• Elimination of the existing loopholes in the present legislations is warranted.
• There should be stringent action against black marketers and hoarders who buy the stocks
from farmers at cheap prices and create artificial demand and then sell the stocks at higher
• Creating local outlets at each village where the farmers sell their stocks directly to the
consumers or the authorized buyers at fixed prices would help to a great extent.
• At the village level there should be counselling centres for farmers about the worth of their
stocks so that they can get fair price.
• The existing legislations are outdated and are not in tune with the changing trends and
technological inventions and the same need to be updated forthwith.
• The retail revolution has brought several changes in the retail sector where the retail giants
buy in bulk directly from the suppliers and sell to the consumers directly and in this process
they pass the benefits to the consumers as well.
• The government is already fulfilling the objective of providing reasonable prices for the
basic food commodities through Public Distribution System with a network of 350,000 fair-
price shops that are monitored by state governments. It is more effective in states like
Punjab, Haryana and some parts of Uttar Pradesh and it need to be strengthen in North east
• Government should levy single entry tax instead of levying multiple entry taxes either
directly or indirectly for the transactions and activities that are involved in agricultural
marketing such as transportation, processing, grading etc., as it would benefit both farmers
and consumers directly.
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