Opinion

Blockchain, the doorway to transforming agri sector

Pankajj Ghode | Updated on October 23, 2020 Published on October 23, 2020

Immutability, transparency and efficiency, the key benefits of blockchain, will help maintain effective and accurate data

Agriculture, along with its allied sectors, is the largest source of livelihood in India with close to 70 per cent of rural households financially dependent on it. India is also one of the top 15 major exporters of agricultural products and clearly has a huge scope to increase employment opportunities across the country.

In fact, innovation combined with advanced technologies like blockchain and artificial intelligence (AI) offer revolutionary solutions to agriculture. However, assimilation of modern technologies takes time but this gap needs to be addressed on an immediate basis so that even small and medium-sized farmers can avail themselves of low-cost technology and benefit from it.

With India being an agrarian economy, blockchain technology will clearly be a gamer changer as it can provide tamper-proof, accurate data about the farms, inventory, credit scores and food tracking. So, farmers no longer have to heavily depend on paperwork/files to record and store important data.

Let’s see in what ways blockchain technology can transform the face of agriculture:

Land ownership, surveying

In India, there is still heavy dependence on physical paperwork and files to store land/farmers’ data, which often could be a cumbersome task and marred with a lot of inconsistencies. Here technology could really come to our rescue as blockchain could provide a systematic, tamper-proof digital ledger of land records in case of farmer/land registrations both in urban and rural regions.

Once the data is effectively linked to respective digital IDs, then the records can be safely maintained even during natural calamities. This data collected can be used for further surveys, maintaining accurate data of landholdings in our country and provide customised solutions to farmers based on their individual requirement, which will help promote sustainable farming.

Blockchain intervention can also help expedite financial settlements and farmers no longer have to wait for payments endlessly, which often leave them distressed. Smart contracts are written in code form and when all the criteria are met, payments are released automatically.

This means farmers fulfil the required prerequisites like digital identification, etc., they supply their commodities and shall receive money into their accounts almost immediately within hours. There are no intermediaries or additional costs involved. In fact, blockchain-based apps can easily provide reliable, secure and instant peer-to-peer fund transfers.

Fraud prevention

Since the information stored on blockchain is decentralised in nature, it cannot be changed or tampered with once fed into the system. If agro-based companies install this technology, this means all the stakeholders involved in online trading deals will be protected from fraudulent activities like hacking and cheating.

All the transactions carried out on this platform will be guaranteed safe, secured and discrete. Even unwarranted price decrease or increase won’t be possible if backed by this technology.

One of the bigger advantages of embracing blockchain is that it could solve challenges in real-time pertaining to information management process across the pre-harvest and post-harvest value chain. This is because blockchain provides an immutable data ledger.

This technology facilitates recording accurate information about the crop origin as well as details of the farmer and trader, which is highly essential for export purpose. Blockchain will promote ease of doing business with increased trust and security. Farm to fork traceability gives confidence to the end-buyer as well.

Blockchain technology can help in providing updated demand and supplier information to all parties involved. Such details will allow farmers to define their own prices and sell accordingly in overseas markets. Blockchain also makes it easier for buyers and sellers across the world to conglomerate under one ‘digital roof’ and carry out due diligence of each other.

The modern technology can also maintain transaction histories of stakeholders involved, which means lesser risky transactions.

Transparency for customers

A blockchain can assist in storing and providing accurate information at every step in the food supply chain. This builds increased trust among consumers to buy products from verified farmers and promote responsible consumption. The unaltered information stored by blockchain can provide reliable information regarding the origin of the food items right from the source to the store.

Going forward, in the near future it’s quite possible that just by a single click, consumers would be able to verify the certified farms from where the produce was sourced from.

Blockchain implementation will help simplify the complicated logistics process, especially in streamlining the deliveries. Both buyers and sellers can be rest assured of quality produce reaching within the given timeframe with the help of smartly designed contracts. Smart contracts can automate the payment distribution process thus eliminating the bottleneck. In fact, technology can help plan out the payment schedule throughout the year as opposed to paying farmers seasonally.

In a nutshell, blockchain is a revolutionary technology that can provide lasting solutions to the gripping problems faced by the Indian agriculture industry. It has the capability to diminish inefficiencies and will promote optimal utilisation of time, energy and resources in the agriculture value chain.

The writer is CEO of Agri10x, a Pune-based agtech company focussed on tech enablement in the agricultural sector

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Published on October 23, 2020
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