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Abstract
The electronic spot exchange provides synergy among the existing marketing systems in the country with
its improvised technology and reach through the online system as it brings a variety of benefits to the
existing system such as price transparency, better price realization for farmers and lot of arbitrage
opportunities for trader community. These exchanges are aimed at enhancing efficiencies of the existing
value chain of commodities by developing appropriate platforms for modern spot markets, financing of
commodities based on credible warehouse management arrangements, reducing transaction costs,
supporting Futures Exchanges, regulators and the Government with standardized and structured spot
markets for compulsory delivery in all agri-commodities. Successful operation of such technologiesdriven
initiatives require congenial policy support as these are largely governed under the state laws of
APMC. From the case study of NCDEX SPOT market in the Gulbarga district of Karnataka state, it has been
observed that for facilitating the small and marginal farmers in participating in new age marketing system,
it is required that all the stakeholders work seamlessly in an integrated manner, which are state agencies
(warehousing, APMC, Mandi, Board, etc.), financial institutions, other infrastructural facilities, etc. With
the help of NCDEX SPOT, tur grower-farmers in the Karnataka states are able to reduce the marketing cost
by 50-70 per cent and are also able to sell their produce, whenever they want by paying a small charge for
warehousing. It is also evident that the farmers could realize, on an average, 5-10 per cent higher price for
their produce as compared to traditional APMC market. Although the business model seems to be working
successfully and showing reasonable confidence to all the stakeholders, requires for upscaling across the
board customization according to the law of land of respective states. However, it is a win-win proposition
for the farmers-state governments-NCDEX SPOT-banks, etc, as its creates values at every stages of value
chain.