Minister releases Model Contract Farming Act

With a view to integrate farmers with bulk purchasers including exporters, agro- industries etc. for better price realization, Union Agriculture Minister Radha Mohan Singh released “Model Contract Farming Act” in Vigyan Bhawan on Tuesday.

Farmer’s producer organizations (FPO’s) have a major role in promoting Contract Farming and Services Contract. On behalf of famers they can enter into agreement with the sponsor.

The Act also aims at Promotion of Farmer Producer Organization (FPOs) and Farmer Producer Companies (FPCs) to mobilize small and marginal farmers.

Ensuring buying of entire pre-agreed quantity of one or more of agricultural produce, livestock or its product of contract farming producer as per contract.

Contract Farming Facilitation Group (CFFG) for promoting contract farming and services at village / panchayat at level provided.

Accessible and simple dispute settlement mechanism at the lowest level possible provided for quick disposal of disputes. It is a promotional and facilitative Act and not regulatory in its structure, clarifies a govt release.

The Act lays special emphasis on protecting the interests of the farmers, considering them as weaker of the two parties entering into a contract. In addition to contract farming, services contracts all along the value chain including pre-production, production and post-production have been included.

The act also stipulates that “Registering and Agreement Recording Committee” or an “Officer” for the purpose at district/block/ taluka level for online registration of sponsor and recording of agreement provided.

The other important points of Act include-Contracted produce is to be covered under crop / livestock insurance in operation, Contract framing to be outside the ambit of APMC Act, No permanent structure can be developed on farmers’ land/premises and No right, title of interest of the land shall vest in the sponsor.


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