The Karnataka government has ushered in significant reforms for its agricultural market yards with the final notification of the Karnataka Agricultural Produce Marketing (Regulation of Allotment of Property in Market Yards) Rules, 2025. These rules, which came into effect at the end of December, expand the permissible uses of land within Agricultural Produce Market Committee (APMC) complexes and introduce stricter criteria for those seeking allotments.
Key Changes in Land Use and Allotment Process
A major shift under the new regulatory framework is the diversification of activities allowed on APMC land. The state's Department of Agricultural Marketing can now allot property for setting up electric vehicle (EV) charging stations and gas stations, including petrol bunks. This move is seen as a step to modernize market yard infrastructure and cater to evolving needs.
The allotment process itself has been formalized with the insertion of a new Rule 9-C. This rule permits sites or vacant spaces to be allotted through public auction on a lease-cum-sale basis. The draft of these rules was first published on June 26 last year, with a 30-day window for objections and suggestions. The government proceeded with the final notification after receiving no objections.
Tighter Eligibility and Stricter Penalties for Traders
The 2025 rules set a higher bar for licensed market functionaries seeking property allotment. To qualify, they must now demonstrate continuous trade in notified agricultural produce for the past three financial years. This provision aims to ensure that allotments go to genuine agricultural traders.
Srirama Reddy, president of the Dasanapura APMC Merchants Association, welcomed this change. He stated that mandating continuous trade will "help genuine merchants and will prevent lobbies, including real estate businesses, to secure allotment of land."
Provisions related to defaults and penalties have also been revised rigorously:
- Delayed payments could lead to the cancellation of allotments, with 25% of the initial deposit being forfeited.
- Other violations could attract penalties of up to 15% of the site's value.
Lease Renewals, Quotas, and Implementation
The rules bring clarity and a structured process for lease extensions. The initial allotment period remains 55 months. Extensions beyond this period will be allowed in blocks of 11 months, subject to approval from the Director of Agricultural Marketing. However, each renewal will come with a 5% increase in lease and licence fees, and defaulters will be barred from further extensions.
This renewal clause was highlighted as a major relief by merchants. Reddy pointed out that officials had recently been asking merchants to return shops after the initial 55-month period, and the new rules provide a clear path for continuation.
In a significant move for inclusivity, reservation provisions have been expanded. Alongside existing quotas for Scheduled Castes and Scheduled Tribes, the new rules introduce a 5% reservation for Farmer Producer Organisations (FPOs), empowering collective farming groups.
The comprehensive update to the APMC allotment rules represents Karnataka's effort to streamline market yard management, prevent misuse, and adapt the spaces to contemporary commercial and agricultural needs.
