Applying Digital India to Tackle Challenges in Agriculture

Siddhanth Murdeshwar

NMIMS Mumbai

Applying Digital India to tackle challenges in Agriculture

On 1 July, 2015, PM Modi launched his ambitious project- Digital India, a national e-governance plan, with a vision to transform India into a digitally empowered society and a knowledge economy. It seeks to create a participative, transparent and a responsive government while ensuring accessibility of citizens to government services electronically and bring in public accountability through electronic delivery of government services.

This project primarily focuses on providing high speed internet, integrating services across jurisdictions to provide governance and services on demand for both online and mobile platform.

India being an agrarian economy poses a pertinent question as to whether an initiative of this magnitude (Rs. 2510 Cr) could be utilized to tap the full potential of the agricultural sector.

ISSUES IN THE INDIAN AGRICULTURAL SECTOR

One of the alarming reasons that the agricultural sector needs reforms is (as of October 2015) 49% of the labour force depends on agriculture while their contribution to GDP is merely 17% (source- The Economic Times). The causes span various factors:

1. Small and fragmented land-holdings- The apparent profusion of a total of 330.9 million hectares of net sown area and net cropped area, combined fades into triviality when these lands are divided into economically unviable and scattered holdings. The average size of a holding is approximately 2 hectares while that of a farmer in developed countries brushes a whopping 400 hectares. This causes low economies of scale, unviable irrigation and low investment in technology.
2. High yields depend upon good quality Seeds, Manures, Fertilizers and Biocides. Although government entities such as the National Seeds Corporation, State farmers Corporation of India attempt to provide raw materials to farmers at affordable prices, unavailability of information for farmers to choose the right “product-mix”- deciding which crops to harvest and which fertilizers to use for their land; deep-ridden corruption at government agencies, amongst other factors, lead to suboptimal yields.
3. Lack of Irrigation and Mechanization- Irrigation is a critical input in India, given an irregular & erratic rainfall pattern. India is the second highest irrigated country after China but only 1/3rd of the cropped land is under irrigation. As of 2013-14, 62-67% of the potential yield was sacrificed due to the poor irrigation facilities.
   The bottleneck for adoption of modern techniques results in crop yields being just 30-60% of the best attainable yields of developed nations.
4. Limited Agricultural Marketing and Agricultural Information- The dearth of reliable marketing facilities for farmers in rural India compels them to, under socio-economic conditions; depend upon traders and middlemen to dispose off their produce at a throw-away price, causing distress sale. According to an estimate, 85 per cent of wheat and 75 per cent of oil seeds in Uttar Pradesh, 90 per cent of Jute in West Bengal, 70 per cent of oilseeds and 35 per cent of cotton in Punjab is sold by farmers in the village itself. Middlemen take away 47%, 52% and 60% of the prices of rice, groundnut and potatoes respectively. (Source- Addressing farmers’ problems, Reference paper by RML (formerly Reuters Market Light), Feb 2015).
   

1. Approximately 94% of the farmers turn to fellow farmers for agri-information, 10% to retailers, 4% on media and 3% on agri-extension service personnel. Most of this information being biased, unverified or misrepresented results in farmers being misguided, not employing the best mix of resources suitable to their land, ultimately resulting in poor production of crops.

1. The following image of the traditional agriculture supply chain model helps explain the complexities involved in the farmers’ produce reaching the consumers and the intermediary margins.
   The retail prices provided are only a reference to the percentage of the final price farmers earn and do not reflect current market prices 

(Source-Outlook India). 

[pic 1]

1. Capital- The arduousness experienced in getting access to credit at affordable interest rates and the adversities faced in repaying them is a major reason for the number of farmer-suicides skyrocketing. According to a nationwide survey conducted by National Sample Survey Organization (NSSO) in Jan 2015, 50% of the 90 million farm households are indebted to moneylenders or banks (Uttar Pradesh having the highest number of indebted farm households at 69 lakhs). Over 50% of the loans were meant for capital & other expenditure on the farm.

EXERCISING DIGITAL INDIA TO IMPROVE THE AGRICULTURAL SECTOR

“Give a man a fish and you feed him for a day. Teach a man to fish and you feed him for a lifetime.”- Chinese Proverb

Until now, a plethora of populist policies were declared to try and improve the existing condition of the sector, but to no avail. For agriculture in India to emerge as an economically viable business, a sustainable model needs to be developed with the prerequisite of farmers, primarily, being well educated in their field, aware and empowered; backed by the State. 

Digital India can be used to address the issues mentioned above, barring the 1st which is a concern of a different nature and would require an altogether different platform to be addressed. Let us see how Digital India can be employed to impact the agricultural value chain to improve its existing functions which could ultimately result in improved sustainable profitability for the farmers.

The project has 3 major components viz. 1) digital infrastructure 2) digital services and 3) digital literacy. Mobile phone is the preferred delivery medium with focus on mGovernance and mServices. The mAgriculture and mGramBazar, out of the seven components covered under mServices, directly impact agricultural extension and marketing services.

Potential of Information & Communication Technology- 72% of the farmers being unaware of sources of information for adopting technology, seeking credit, insurance and marketing services is a major reason for low productivity. As of 2014, 68.32% of rural households avail mobile connectivity. Study of the IAMAI revealed 80% using it for communications, 67% for online services, 65% for e-commerce and 60% for social networking; which is why mobile phones can be effectively used for generating, processing, disseminating and sorting critical agri-data.