by Vanisha Sharma

Introduction

Despite the recent rise in the manufacturing and services sector in the Indian economy, agriculture continues to be the main source of income to the country’s GDP. On the one hand, around 70% of Indians below the poverty line live in rural areas[1]. Interestingly, on the other hand, nearly 75% of all Indian families depend on rural incomes[2]. The nation’s agricultural activities mainly rely on producing cereal crops, fruits and vegetables, along with breeding and raising livestock. However, there continues to be a gap between the production of crops and livestock and consumption, which has led to malnutrition- a perpetuating socio-economic challenge facing the country’s policy makers till date. In 2015, the Indian government approved the creation of an online platform to facilitate monetary transaction for agricultural produce between farmers, traders and buyers[3]. e-NAM aims to combat the double-sided complexity of inadequate access to food along with insufficient sales of crops, by providing a platform to narrow the gap between demand and supply of food. This essay seeks to explore the potential success of this proposed reform, as well as provide some recommendations for the possible challenges it might face in the implementation process.

The Problem in Context

Under the ‘Green Revolution’ of the 1960s, the Indian agricultural sector witnessed an immense increase in the productivity of crops when high-yielding varieties of seeds, better irrigation combined with increased use of fertilizers was introduced to rural farmers across the country. However, despite the spike in sales and agricultural productivity, the green revolution faced some criticism by researchers that proposed that it led to income differentials between different farmers[4], not without adversely affecting the environment[5]. Further, the positive externalities of the revolution were not nearly sufficient to raise most farmers out of the debt trap, and to completely eradicate malnutrition and. For instance, even in 2014, half a century after the implementation of green revolution, 5,650 farmers committed suicides due to high debt burdens[6]. To add to that, stunting prevalence due to malnutrition in children under 5 years of age in rural India is more than 40%[7]. Therefore, there remains to be a steep kink in the supply chain of crops, which prevents farmers from benefitting from sales, as well as deprives a certain section of consumers from access to the produce.

There can be multiple reasons that lead to this gap. First, it is not uncommon to have inadequate transportation infrastructure connecting rural farms to physical market places, wholesalers and retailers. This might lead to some hurdles because farmers are not able to sell their entire produce before it goes stale. Second, hoarding is an unfortunate, yet fairly prevalent, behavior found in all market places, where the distributors may stock up the produce bought from farmers, but sell it at extremely high prices in the market to earn large profits. Lastly, lack communication between sellers and buyers entails lack of, or imperfect, information related to the price, quantity and quality of the produce[8]. By providing a platform that facilitates direct interaction between farmers and sellers, e-agriculture aims to combat each of these abovementioned problems.

e-NAM: The Proposed Solution

Traditional policies have always attempted to increase agricultural productivity per unit land, however, only recently have attempts been made to address the inconvenience in buying and selling crops[9]. A shift in focus is needed from improvement in production methods to better policy reforms to augment sustainable, efficient agricultural activities along with food security in India. e-NAM manifests this shift in focus by devising a virtual marketplace to enhance the flow of products and income surpassing the inevitable obstacles facing a geographic marketplace.

E-agriculture involves extensive use of information and communications technology (ICT), which includes various types of hardware and software developments operated through telecommunication networks. These ICTs will then help form connections between individuals and communities based on their occupations and interests[10]. This will lead to better awareness and information, improved networking and communication, reduction of risks and higher incomes for farmers[11]. e-NAM is the pilot project of an e-trading platform for the National Agricultural Market (NAM)[12]. So far, 21 ‘mandis’ (physical market places that sell produce) from 8 states have joined e-NAM[13]. The Association for People of Haryana (AFPOH), in collaboration with Perry4Law organization, is a private non-profit organization that has taken multiple initiatives at establishing connections between ICT, agriculture, health and banking [14]. The organization strongly advocates in favor of utilization of ICT to mitigate the condition of rural farmers in the country. A public-private partnership between the government of India and a private not-for-profit entity like AFPOH might result in the optimal outcome of an e-agriculture initiative.

Aside from bridging the gap between the supply and demand of agricultural produce, the online platform can also provide information to farmers regarding new farming techniques and their costs, weather forecast, comparison to prices in the international markets, credit markets and microfinance institutions, types of high-yield variety seeds, better quality of pesticides and fertilizers and much more[15]. At the same time, consumers will have a greater information about the various product choices they have, pricing of the products, where the fresh produce they consume is actually coming from, and other relevant agricultural information[16]. An added benefit of this platform will be interaction between rural and urban residents, which seldom takes place in a country where the two communities are so stringently divided. This will develop a greater understanding of the ‘other’ community, and will spread more awareness about the extent of rural assets available in India.

Potential Challenges and Recommendations

One main challenge that e-NAM faces is to manifest the theory into practice. It seems like an ideal policy initiative to the current challenges in the Indian agriculture sector, however, its implementation is far away from actualization. With 37% of villages in India still not ‘electrified’, or without access to electricity[17]; access to computers and ICT seems like a distant dream in this case. Further, introducing ICT to a practice that has been on-going for millennia, it is certain that beneficiaries will demonstrate a resistance to adopt new technology as opposed to following the default path[18]. Moreover, the government will need to employ a secure connection to carry out monetary transactions at such a high frequency, in order to avoid cases of cyber-crime and embezzlement. Lastly, delivery of the produce will pose another challenge. Due to lack of adequate infrastructure, making the produce available to the consumer will require a possible third-party that will be responsible for transporting the goods from the rural farms to consumers located in both rural and urban areas.

It is recommended that the government take full advantage of the underlying potential of upcoming technological private enterprises in implementing the necessary ICT in the already-electrified communities, as well as in the delivery of produce; specifically, in the form of a public-private partnership. This will optimize the efficiency as well as effectiveness of the desired policy initiative[19]. Additionally, to tackle the resistance to change, training and information sessions can be organized by the implementing bodies to familiarize the farmers and consumers unfamiliar with technical interfaces. The policy can also be introduced to children in schools to inculcate the habit of buying produce directly from farmers at an early age.

Conclusively, e-NAM is a well-intended policy initiative at its nascent stage that aims to amalgamate ICT with agriculture in India. Once initiated, this notion has a tremendous potential to build a concrete link between the demand and supply of food in India, promising both food and employment security to consumers and farmers. However, a glance at the current divide between provision of ICT in rural and urban India shows that the actualization of this initiative requires strong political will and sincere effort, preferably by both public and private parties. Under the current government of Bhartiya Janta Party, and right-leaning Prime Minister Narendra Modi, a public-private partnership to catalyze the implementation of e-agriculture seems to be a viable and realizable option. The pilot-project e-NAM will help relevant officials gauge the needs of the farmers and consumers, which will help them modify the program to develop a more concrete platform that is user-friendly and effective. If a holistic approach is adopted in implementing e-NAM throughout the nation, it can be a crucial move in mitigating the socio-economic status of farmers, along with consumers, by bridging the gap between the two seemingly near, yet distant sides of the market.

References

“Accidental Deaths and Suicides in India, 2014.” National Crime Reports Bureau. Government of India, n.d. 2014.

Express News Service. “Agriculture Reform: Government Takesfirst Step for a National Farm Market.” ieNation, July 3, 2015.

  1. Pradhan, and B. B. Mohapatra. “E-Agriculture: A Golden Opportunity for Indian Farmers.” IRD, India, 2015.
  2. Prahladachar. “Income Distribution Effects of the Green Revolution in India: A Review of Empirical Evidence.” World Development 11, no. 11 (1983): 927–44.

Madhur Gautam (EPW). “Making Indian Agriculture More Resilient.” Economic and Political Weekly, February 20, 2016.

PM Modi’s Address at the Launch of National Agriculture Market (NAM) in New Delhi, 2016.

Praveen Dalal. E-Agriculture in India, 2008.

R.B. Singh. “Environmental Consequences of Agricultural Development: A Case Study from the Green Revolution State of Haryana, India.” Agriculture, Ecosystems and Environment 82 (2000): 97–103.

Richard H. Thaler, and Cass R. Sunstein. Nudge: Improving Decisions about Health, Wealth and Happiness, 2008.

“Rural House Electrification.” REC Power Distribution Co. Limited, 2017.

The World Bank. “India: Issues and Priorities for Agriculture,” The World Bank, May 17, 2012.

UNICEF. “Undernutrition Contributes to Nearly Half of All Deaths in Children under 5 and Is Widespread in Asia and Africa.” UNICEF, 2017.

[1] The World Bank, “India: Issues and Priorities for Agriculture.”

[2] Ibid.

[3] Express News Service, “Agriculture Reform: Government Takesfirst Step for a National Farm Market.”

[4] M. Prahladachar, “Income Distribution Effects of the Green Revolution in India: A Review of Empirical Evidence.”

[5] R.B. Singh, “Environmental Consequences of Agricultural Development: A Case Study from the Green Revolution State of Haryana, India.”

[6] “Accidental Deaths and Suicides in India, 2014.”

[7] UNICEF, “Undernutrition Contributes to Nearly Half of All Deaths in Children under 5 and Is Widespread in Asia and Africa.”

[8] L. Pradhan, and B. B. Mohapatra, “E-Agriculture: A Golden Opportunity for Indian Farmers.”

[9] Madhur Gautam, “Making Indian Agriculture More Resilient.”

[10] L. Pradhan, and B. B. Mohapatra, “E-Agriculture: A Golden Opportunity for Indian Farmers.”

[11] Praveen Dalal, E-Agriculture in India.

[12] PM Modi’s Address at the Launch of National Agriculture Market (NAM) in New Delhi.

[13] Ibid.

[14] Praveen Dalal, E-Agriculture in India.

[15] L. Pradhan, and B. B. Mohapatra, “E-Agriculture: A Golden Opportunity for Indian Farmers.”

[16] Ibid.

[17] “Rural House Electrification.”

[18] Richard H. Thaler and Cass R. Sunstein, Nudge: Improving Decisions about Health, Wealth and Happiness.

[19] Praveen Dalal, E-Agriculture in India.

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