Explain the steps taken by the government in developing rural markets.

Following are the steps taken by the government in developing rural markets

(i)  Regulation of Markets - The government has established regulated markets where the sale and purchase of the produce are monitored by Market Committee consisting of representatives of government, farmers and traders. Regulation of markets helps to create orderly and transparent marketing conditions.

(ii) Improvement in Physical Infrastructure - Through this measure, the government ensures the improvement in physical infrastructure such as roads, railways, warehouses, cold storages, etc.

(iii) Cooperative Marketing - The government encourages farmers to form producer marketing cooperative societies so that they get a better price of their produce through a collective sale.

(iv) Supportive Policies - In addition to the above policies, the following supportive policies have also been introduced to develop rural markets.
(a) Minimum Support Price (MSP) - The government fixes MSP for agricultural output. This policy assures a minimum income to the fanners.
(b) Maintenance of Buffer Stock of Wheat and Rice - When market price falls much below the MSP, then government purchases the produce from the farmers at MSP and maintains buffer stock.
(c) Distribution of Foodgrains and Sugar - The buffer stocks are distributed among the poor through the Public Distribution System (PDS) at subsidised prices.

The government has made the following initiatives to develop rural markets.

1. Market Regulation - The government has established regulated marketplaces in which the selling and purchase of produce is overseen by a Market Committee comprised of government representatives, farmers, and traders. Market regulation aids in the creation of ordered and transparent marketing circumstances.

2. Cooperative Marketing - Farmers are encouraged to create producer marketing cooperative societies in order to achieve a higher price for their produce through a collective sale, which the government favours.

3. Physical Infrastructure Improvement - This measure guarantees that physical infrastructure such as roads, railways, warehouses, and cold storage facilities are improved. These facilities are still woefully inadequate and in desperate need of upgrading.

4. Supportive Policies - In addition to the policies listed above, the following supportive policies have been implemented to help rural markets grow.
(a) Minimum Support Price (MSP) – The MSP for agricultural output is set by the government. The fanners are guaranteed a minimum income under this programme.
(b) Wheat and Rice Buffer Stock - When market prices fall substantially below the MSP, the government buys the produce from the farmers at the MSP and keeps a buffer stock.
(c) Foodgrains and Sugar Distribution - The buffer stockpiles are distributed at subsidised prices to the underprivileged through the Public Distribution System (PDS).