Cardamom could soon be traded through an electronic system, which Spices Board says would ensure trading transparency and help small growers.

Minister of State for Commerce Jairam Ramesh will launch the electronic auction (e-auction) system at Tamil Nadu's Bodinayakanur, India's a major assembling centre for cardamom on August 23.

The e-auction system, developed with the support of the Tata Consultancy Services [Get Quote], aims to provide transparency in transactions and to promote healthy competition for purchases.

The Board has proposed introduction of e-auction in cardamom to revamp the existing manual procedures at par with modern technologies. The new system will provide a calm platform to make the transaction smooth and hassle-free, officials claim.

E-auction facilitates error-free documentation and speedy billing and invoicing, eliminating the chances for hidden costs. As the identity of the bidder is not revealed during the process of auction, the chances of speculation is also discouraged.

The Board is planning to establish a common facility for cleaning, grading and packing jointly with auctioneers, aiming to help traders to sell the auctioned commodity without delay and costs.

The E-auctioning system will be first operational in Bodinayakanur, which accounts for 80 percent of cardamom traders in this commodity. The hill-town also accounts for 21 per cent of the total cardamom auctioned in the country.

The e-auctioning system replaces the traditional manual auction system of shouting out of bids now being followed in all auction centers in Kerala, Tamil Nadu and Karnataka. Farmers say this system lacked clarity.

In these three southern Indian states, cardamom is a main stay crop for many thousands of farmers. In 2006-07 the volume of business in the auction centers was 7,939 tonnes. The total production of cardamom (small) in 2006-07 was 11,535 MT of which 7939 MT (69 per cent) was auctioned.

Currently cardamom auctions are held during various days of the week in Kumily, Vandanmedu, Nedumkandam, Pulianmala and Calicut in Kerala and in Bodinayakanur in Tamil Nadu. In Karnataka auctions are held in Saklespur, Sirsi and Mercara. In North India auctions are being held in cities of Bombay and Kolkata.

Based on the performance of Bodinayakanur, the board will introduce e-auctions in the major auction centers of Vandanmedu, Kumili, Thekkady and Pulianmala in Kerala later.