Context: As per the latest government data, the inter-State trade volume on the electronic-National Agriculture Market (e-NAM) saw a sharp decline of 78% during FY25.
Relevance of the topic:
Prelims: Key facts about electronic National Agriculture Market (e-NAM).
Mains: electronic National Agriculture Market (e-NAM): Implementation Challenges.
About electronic National Agriculture Market (e-NAM)
- The Government of India launched the electronic National Agriculture Market (e-NAM) in 2016.
- It is a pan-India electronic trading portal that integrates existing physical wholesale mandis and markets across the country to create a unified national market for agricultural commodities.
- Implemented by: Small Farmers Agribusiness Consortium (SFAC), under the aegis of Ministry of Agriculture and Farmers’ Welfare.
- Objectives:
- Integration of APMCs through a common online market platform to facilitate pan-India trade in agriculture commodities.
- Providing farmers better price for their produce through a transparent auction process based on quality of produce along with timely online payment.
- Removing information asymmetry between buyers and sellers and promoting real time price discovery based on actual demand and supply.
Difference between e-NAM and the existing Mandi System
- e-NAM is not a parallel marketing structure but rather a device to create a national network of physical mandis which can be accessed online.
- It seeks to leverage the physical infrastructure of the mandis through an online trading portal, enabling buyers situated even outside the Mandi/ State to participate in trading at the local level.
- e-NAM offers a “plug-in” to any market yard existing in a State (whether regulated or private).
As of June 2025, over 1520 Mandis are onboarded on e-NAM portal. The total value of agricultural produce traded on the e-NAM portal till the date stands at ₹4.3 lakh crore.
Implementation Challenges faced by e-NAM
- Low penetration: Only ~23% of the APMCs across the country are connected using e-NAM, making this facility available to only 25% of farmers in India.
- State-level Licensing & APMC Laws: Agricultural marketing is a state subject; many states do not allow reciprocal licence recognition which restricts outside traders. Only a few states have amended their APMC Acts to allow inter-State trade via e‑NAM. As a result, the inter-State trade volume on e-NAM is low, and even declining.
- Poor participation of farmers: Most of the small farmers are reluctant to participate in e-NAM, because:
- Small farmers still prefer to sell their produce to local intermediaries as an obligation towards the input credit provided by them.
- Digital payments made under e-NAM are a barrier to the repayment of informal loans that farmers have taken from commission agents.
- Limited awareness of the e-NAM scheme and its benefits among the farmers.
- Infrastructural gaps: Inadequate infrastructure such as e-gate passes (entry and exit), quality assaying labs, and underdeveloped IT Infrastructure inhibited the efficient functioning of e-NAMs.
- Resistance by Traders and Middlemen as the online system is more accountable and would bring them under the ambit of tax.
Way Forward
- Creating an enabling infrastructure: The mandi should take the responsibility to arrange for logistics and transportation that would facilitate inter-mandi trading on e-NAM. This could be done by outsourcing the tasks related to logistics to a third party.
- Part-cash and part-online payments to farmers: Farmers at the initial stage should get an option to receive payment partly in cash and the remaining in their bank account. E.g., Madhya Pradesh model.
- Liberal licensing:
- States should take proactive steps to liberalise trading licences within their jurisdiction to boost inter-State trade, and enable provisions in APMC Acts for reciprocal recognition of mandi licenses, unified licences etc.
- The existing license of the traders should be upgraded to a unified license that lets them trade across any mandi in the country. The fees to upgrade the license should be nominal.
- Ban on conventional trade and mandating the traders to shift to e-NAM.
- Providing Incentives to farmers and traders like Agri-input supply coupons etc. to encourage them to participate in e-NAM.
The government plans to rollout e-NAM 2.0 to integrate logistics providers and provide last‑mile logistics. The main features of e-NAM 2.0 would be bank account validation, eKYC features using Aadhaar and onboarding of assaying, grading, logistics and other value added service providers.