Empowering the deprived community of India through technology 

Agriculture still is the backbone of the Indian economy and more than 64 per cent of the population still resides in rural India. But the problem in rural India is that 84 per cent of farmers have small and marginal holding less than five acres of land. They form the most deprived section as access to quality production and finance has become difficult with the vast distribution and fragmentation of land holdings. A few years ago, as you went closer to the farm gate, you would have found that smallholder farmers were totally isolated from the changes and formalisation taking place in the ecosystem. Slowly, the boundaries that once separated rural India blurred with better connectivity and access. We are seeing an emergence of a new age agri ecosystem with increased networks, improved transparency, and quality assurance for seamless agri commerce today.  

Tackling huge task with technology 

With the penetration of mobile telephones in India, the distribution of financial services and the dissemination of technology has become much easier. 

Chattanathan Devarajan

Without the advent of technology, the challenges to bring improvement to a lot of mainly small and marginal farmers, who form the majority in rural areas, would have been a herculean task. Technology has dramatically impacted productivity and efficiency in larger markets. Crop choices and production planning have experienced a more substantial shift to advanced mechanisation and precision farming. With abilities to track, analyse, and understand food systems, crop quality can be improved, productivity raised, food waste reduced, and also enabling traceability. 

Drone/GPS/satellite-based farm surveillance help farmers manage inputs and productivity; while image, spectral, and sensor analytics impacts yield quality.  

Inadequate storage facilities, increasingly erratic climatic shifts, and inept logistics are some constraints prevalent in post-harvest management. The supply chain, as a result, takes a hit and impedes growth in rural income. Change is crucial at this stage and can be driven through digital and tech integration, allowing farmers to increase ownership in the overall supply chain management. 

Last mile accessibility 

With the emergence of digital marketplaces and last-mile accessibility with trade assurances, today even small and marginal farmers can get the correct value for their produce.  

Today’s farmers can work towards market-driven food production in a highly digital ecosystem compared to the traditional agri-value chains. However, it is crucial to understand that around 118 million farmers in India are operating 145 million landholdings, out of which more than 85 per cent are marginal and small holdings. The challenges of fragmentation – of landholdings and the value chain – continue to burden these smallholder and marginal farmers who are on the fringes of digital inclusion and development. Here, the formation of FPOs comes in handy and with technological interventions; FPOs can manage the inputs of farmers and aggregate the output for effective cost reduction and better price realisation. Through these measures, we are indeed seeing a social cohesion of the three Es - employment, economic growth, and empowerment in the hinterlands. 

Overcoming limited options 

While technology has some long-term solutions to offer to the agriculture sector as explained above, to bring real impact, we need to solve an agricultural ecosystem where these farmers with limited options are economically resilient. Especially, when the available land is shrinking and with the complexities of extreme temperatures and weather variability.  

While these challenges are existing, a new set of challenges is emerging by way of climate change due to the indiscriminate use of fertilisers and pesticides and other carbon emissions in the environment. In this context, the question that we must ask ourselves now is, “Can we, through the partnership of technology, professional expertise, and the wisdom of our farmers, solve towards mitigating the damage of climate change and create a world where these producers have a larger share in the consumer’s rupee?” Herein comes sustainable agriculture with technological interventions. 

However, good technology interventions could bring in, with respect to crops, the adoption of the same cannot happen without access to finance. As per the Reserve Bank of India report, small and marginal farmers have been deprived of credit. Hence, the adoption of fintech at the grassroots enables tackling agri-finance complexities. The growth of the cashless economy and financial technology generates new ways to target and collateralise credit and manage risks with competitive pricing, which was hitherto not possible. They were most of the time left to the mercy of money lenders who charged exorbitant rates. The blockchain-backed mobile money, better user interface, and ease of accessing financial products inject much-needed financial inclusion into the country, even though it is a nascent stage. The aim for fintech startups should be to connect the disintegrated agri-ecosystem, especially the marginalised and smallholder farmers, with the whole ecosystem, from supply chains to credits, to storage, and easier accessibility to financial products. 

Integrated digital platform 

Agtechs are transforming the ecosystem by providing storage on demand, warehouse receipt financing, quality assessment, and facilitating digitalisation, among others. For example, today organisations like Arya.ag offer crop intelligence, warehouse discovery, financing, and market linkage solutions through an integrated digital platform accessible across the value chain.  

While these technologies are bringing in the small and marginal farmers and the woman to the mainstream economy, these tech initiatives also offer unprecedented voice and choice to the most important stakeholder in Indian agriculture- the female farmers - offering them a path to shift their role from labour to leadership. As seen in the microfinance space, women are a better cohort to lend to, and the impact is a real improvement in the quality of life for their families, which eventually trickles down to the community. 

Thus, the advent of tech in agriculture and finance gives a peek into a promising future of rural India by bringing the deprived to mainstream business. Success would be enabling emerging technologies in the agri space to build a robust system that effectively integrates the smallest farmers into the formal value chains in a scalable and affordable manner. The more technology becomes scalable and affordable; we have the power to improve efficiencies and bridge existing gaps to build sustainable and resilient agri-food systems globally. Even as India takes gradual steps towards innovation, the true success of agritech will be in overlaying technology to bring about a large-scale irreversible, positive change. 

(The author is the co-founder of Arya.ag) 

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