Summary With the help of case material from Tamil Nadu, West Bengal and Bangladesh, the politics of market organization is examined. Political parties do not have consistent positions on private trade and are responded to opportunistically by foodgrains traders. Traders are politically active in a variety of local religious and social service institutions within which they build networks. The commodity association is the principal arena of mercantile politics. Formed defensively in response to threats by the state or by unionized labour, they have developed systematic lobbying capability. They have also developed self‐regulatory functions, extending to physical security, law and order and enforcement of the terms of participation of smaller traders. The article concludes by discussing the implications of such politics for state intervention.