In the past few years, there have been several attempts to catalyse e-commerce in rural agricultural and non-farm products by integrating commerce, technology and value-added information, to help expand the choices for rural India and make farming more profitable. ITC’s e-Choupal began small in 2000, as a project to help soya growers in Madhya Pradesh by providing information and creating a direct market channel on a web-based platform. Six years later, it is the largest rural initiative of its kind, covering seven states, 31,000 villages and aiding 3.5 million farmers.
In many ways, e-Choupal set a precedent. Many more farmland innovations, some quite similar to e-Choupal, have followed since then. These have been driven by two compelling factors: technology and modern retail.
Technology is already being deployed in rural areas in the form of various information and communication technology initiatives by some public sector institutions, corporates and non-government organisations. The government, too, wants to set up a ‘village knowledge centre’ in each of India’s 6,25,000 villages. Secondly, the ascent of modern retail will help farmers plug in directly to a huge market opportunity, bypassing the current cumbersome supply chain.
Though the government has announced plans to double agricultural production by 2012, innovative and even radical solutions are needed to achieve it. Here are some initiatives that could be a step in the right direction.
AIC A satellite to settle claims
The Agriculture Insurance Company of India (AIC) is pilot-testing a project in which insurance is paid to farmers even before the crop has been harvested. For instance, for wheat crop insurance, the company used satellite images to monitor crop health in parts of Haryana and Punjab .
Normally, investigations by the insurance company are made after harvest, and it usually takes a few months for the farmer to receive the insurance amount in case of a poor yield. Thus, if wheat is harvested in April, a farmer could receive his money as late as August. But the use of satellite technology could quicken this process by several months.
In its pilot test for the Rabi season 2005-06, AIC used satellite images to measure the normalised difference vegetative index (NDVI), which is used to determine the loss in crop yield. Using this method, the company could estimate low crop yields as early as the second week of February 2006. The insurance was paid in March, much before the crops were harvested. “Not only does the use of remote sensing technology speed up the process, it also reduces errors because there is no human inference. Besides, it is more objective,” says K.N. Rao, manager, AIC.
In its pilot phase, AIC has paid farmers wheat crop insurance based on two factors: yield loss based on NDVI and loss resulting from high temperatures for a specified period. A farmer can choose either or both options, and will be paid a maximum of Rs 5,000 per hectare for each. During 2006-07, the company plans to expand the project not only within Haryana and Punjab, but in other states as well.
IIIT, Hyderabad Tele-medicine for crops
How can farmers in distant villages avail of crop-related advice from agricultural experts in cities on a regular basis? The eSagu initiative in Andhra Pradesh, developed by the Indian Institute of Information Technology (IIIT), Hyderabad, is using digital technology to make this possible. eSagu is an IT-based system to improve agricultural productivity by providing timely and personalised expert advice to farmers.
In this system, agricultural experts in a nearby city guide farmers through each crop season. A coordinator, who is an educated farmer from the village, collects information about a farm, say in Warangal, Andhra Pradesh. He stores this information on a CD and sends it to a team of experts in the agricultural lab in Hyderabad. The coordinator also takes photographs of the farms on a regular basis, using a camera phone or digital camera, and sends them to the laboratory. The experts then use this data to analyse the crop situation and prepare advice specific to each farm. This is then downloaded at the eSagu village centres via the Internet.
One such centre is set up for every five to six villages, and one coordinator is appointed for every 125 farms. The initiative was tested in three villages in Warangal over the last one year. So far, the eSagu team has dispensed over 20,000 notes of advice, by analysing approximately 1.1 lakh crop photographs.
According to P.K. Reddy, chief investigator, eSagu, a comparative survey showed that farmers who use eSagu benefit by as much as Rs 3,800 per acre, compared to those who do not. Emboldened by this success, eSagu will now scale up operations to six districts in Andhra Pradesh. It is also working on developing a successful business model for the venture. “We are planning to collect Rs 200 per acre from the farmers,” says Reddy.
EID Parry Help is in the corner
In 2001, EID Parry started the India Agriline project in Tamil Nadu. It set up eight Internet kiosks in Nellikuppam to aid the farmers who supplied sugarcane to its sugar factory there. Initially, these ‘Parry’s Corners’ acted as agricultural information centres for the farmers, providing market rates, weather forecasts and crop-related information. Since then, 40 such kiosks have come up and, more importantly, they have evolved into a services centre for farmers, providing information and also integrating cane operations. They cater to some 100,000 farmers who are the company’s registered suppliers.
The cane supply system involves over 40 steps, including registration, getting seeds from certified nurseries, and selecting the right type and amount of fertiliser. Now, thanks to the kiosks, most of these can be done online.
From the time of planting till the harvest is sold, cane inspectors at the kiosk provide assistance to the farmer. Earlier, the inspectors would enter the information into the factory’s main server after office hours. Also, the divisional offices would get jammed during the registration period for farmers. Now, it is all done locally at the nearest Parry’s Corner, which is linked to a centralised server at the factory through a WLL connection.
Farmers are paid within 14 days of harvest, and can check their accounts at the kiosks to see whether the payments have been made and other details. The company has also tied-up with banks to make loans and crop insurance available to farmers through these Parry’s Corners. “All the farmer has to do is walk into the place. He will be assisted in filling up the necessary forms and guided through the entire process,” says K. Raghunandan, vice-president (sugar division), EID Parry.
The company is now expanding the project to its other sugar factories in Tamil Nadu. Around 25 kiosks have been set up around its factory in Pudukottai. Another 15 are expected to come up this year.
Yes Bank On-demand farming
Market feedback is important for the development of new products in most sectors. Now, the same principle is being applied to agriculture. Mumbai-based YES Bank, in collaboration with Wageningen University of The Netherlands, will help set up integrated ‘agri parks’ in India over the next few months. These will incorporate various forms of agriculture within one campus, in a way that will maximise output.
The concept is based on the principle of contract farming, but with a difference. An agri park is linked closely with the demand side of the food chain, thus ensuring a ready market for the goods produced, and benefiting farmers. This is like on-demand farming — the farmer grows only what the market wants. The technical expertise for setting up the parks will come from Alterra, an institution of the Wageningen University. Alterra will help in setting up the necessary infrastructure for large-scale production of food products, and advise in its operation.
The bank believes that the boom in the retail sector will provide a huge opportunity for the domestic processed food market, which the parks aim to tap. “For retail chains, standardisation and safety of food products is very important. They will be looking for good vendors who can offer scale. These agri parks can provide that,” says Kalyan Chakravarthy, country head (food and agriculture business, strategic advisory and research), YES Bank. The bank is also in talks with the major retail players for such an arrangement.
At present, four locations — Andhra Pradesh, Uttaranchal, Rajasthan and the North-eastern states — have been short-listed for setting up the parks. They will follow a public-private partnership model and focus on the production of cereals, fruits, vegetables, meat and poultry. So far, major private players like ITC, Dabur and Tata have evinced interest in the project.
Incois Fishing from the sky
Remote sensing technology has helped fishermen to zero in on potential fishing zones (PFZs), that is, areas of the sea where maximum fish can be found. After the launch of Oceansat I, the Indian Space Research Organisation has demonstrated the technique of using integrated PFZ maps to find the best fishing areas during consecutive fishing seasons.
It found that by using the maps, the fishermen’s catch increased by three to four times. Besides, it also saved precious time. The technique was soon put into operation, and is now handled by the Hyderabad-based Indian National Centre for Ocean Information Services (INCOIS). Under INCOIS’ aegis, over 200 nodes have been set up across the country to make this information available to fishermen.
PFZs are determined on the basis of two factors. The first is chlorophyll information gathered from the satellite’s Ocean Colour Monitor, which records the density of the presence of phytoplankton, which fish feed on. The second is sea surface temperature. Maximum fish is found in ocean areas that have a sharp temperature gradient. By plotting the two on a map, fishermen can be guided to the best areas for fishing.
The forecasts are sent out thrice a week — Tuesday, Thursday and Saturday — and are valid for the next three days. INCOIS disseminates the information to fishermen through its nodal centres, government agencies, fishery departments and fishermen’s groups, using fax, telephone and the Internet. The information is also displayed on electronic boards in areas where fishing is a major occupation.
INCOIS now plans to use Oceansat II — to be launched by ISRO in 2007 — to continue its research activities.
Businessworldindia Namitha Jagadeesh
