UPLIFTING THE LIFE CONDITIONS OF FARMERS : ATHEY NALLATHA’S STRATEGIC INTERVENTION TO CREATE A FAIRNESS VALUE CHAIN AMONG ITS STAKEHOLDERS

Shazana Shariff started 'Save The Farmer' mission to create awareness about the impoverished state of the country's farmers and raise funds to improve their lives. Educating farmers on technical know-how and new agricultural methods to increase productivity have been a few other ways she uses to make a change. Shazana Shariff is a young social activist who has been passionately working for the upliftment of the farmers. She believed that farmers, the annadata responsible for bringing food to our tables, would be living a happy and content life. However, a visit to one of the farms during her childhood proved to be a reality check for Shazana, when she witnessed the farmers struggling to make ends meet even after spending time cultivating and harvesting the crops. This motivated the young girl to step up and be a part of the solution in her own special way. Shazana started 'Save The Farmer' mission to create awareness about the impoverished state of the country's farmers and raise funds to improve their lives. Educating farmers on technical know-how and new agricultural methods to increase productivity have been a few other ways she uses to make a change. As per data pertaining to 2018, agriculture employed more than 50 per cent of the Indian workforce and contributed 17–18 per cent to the country's GDP. However, the sector is still filled with extreme challenges including climate change concerns, farm households under debt, and farmer suicides. Shazana felt that the illiteracy of any farmer should not be a barrier to strengthening their livelihood opportunities.

This is an Open Proposal for entrepreneurs for contributing 1% of the profits back to the Farmers ; “for they have the right to own it”.

Abstract :

Athey Nallatha is a social food brand inclined with technology to enhance the lives of farmers by a strategic intervention. The brand is proposing a vertical and horizontal intervention to develop the lives of the most suffering class in the food value chain. The brand has already gathered more than 10 other brands which are ready to donate 1% of their profits towards achieving this big objective. This is the proposed national-level farmers’ development project called “Farmers 1%”. The proposal ensures a long term sustenance, essentially benefiting all the stakeholders, especially farmers in the food value chain of India.

 

A. State of Indian Agricultural Sector :

The macro economic condition of the farmers is in a state of peril, for they should be compensated well even to sustain the dignity of their lives.

India ranks second worldwide in farm outputs. India is the world's second-largest producer of rice, wheat, sugarcane, cotton, groundnuts, fruits, and vegetables. It also produced 25% of the world's pulses, from the last decade, until 2019. As of 2018, agriculture employed more than 50% of the Indian workforce and contributed 17–18% to the country's GDP. The economic contribution of agriculture to India's GDP is steadily declining with the country's broad-based economic growth. Still, agriculture is demographically the broadest economic sector and plays a significant role in the overall socio-economic fabric of India. The total agricultural commodities export was US$3.50 billion from March - June 2020. India exported $38 billion worth of agricultural products in 2013, making it the seventh-largest agricultural exporter worldwide and the sixth largest net exporter.

World Bank: "India Country Overview 2011 says: "With a population of just over 1.3 billion, India is the world's largest democracy. In the past decade, the country has witnessed accelerated economic growth, emerged as a global player with the world's fourth-largest economy in purchasing power parity terms, and made progress towards achieving most of the Millennium Development Goals. India's integration into the global economy has been accompanied by impressive economic growth that has brought significant economic and social benefits to the country. Nevertheless, disparities in income and human development are on the rise. Preliminary estimates suggest that in 2009–10 the combined Indian poverty rate was 32% compared to 37% in 2004–05. Going forward, it will be essential for India to build a productive, competitive, and diversified agricultural sector and facilitate rural, non-farm entrepreneurship and employment. Encouraging policies that promote competition in agricultural marketing will ensure that farmers receive better prices."

In 2012, the National Crime Records Bureau of India reported 13,754 farmer suicides. Farmer suicides account for 11.2% of all suicides in India. Scholars have offered several conflicting reasons for farmer suicides, such as monsoon failure, high debt burdens, genetically modified crops, government policies, public mental health, personal issues, and family problems.

We should be aware that farming is the basis of any country's economy, and the farmer is the backbone of society. India being an agrarian country, even after 70 years of independence, more than 70% of the population still finds their livelihood from the agricultural sector. Indian experience shows that even though farmers are high in number, the amount of farming (in terms of GDP) is decreasing. This gives rise to disguised unemployment and underpaid farmers are rampant and in distress.

Food production is closely tied to the natural environment and the life cycle of plants and animals. It is thus influenced by factors that are, to a varying degree, beyond the control of producers (climate, diseases) and has social and environmental impacts that are increasingly moving from externalities to internalized production costs. Farmers' suicide rates have become one of the most serious issues in modern India. The biggest cause is bankruptcy due to the high-interest rates of money lenders and the constant failure of crops due to monsoon variation. Our irrigation methods have not improved sufficiently since the colonial era, and remember that most farmers still rely on monsoons. This pathetic situation of the farmers in the supply chain has a drastic effect on the Indian economy in multifarious ways.

B. Proposal: Reverse Injection into the Agricultural Supply Chain Plan and its Economies :

It's not a donation, but a win-win value addition for the giver & the receiver.
I would propose that if start-up entrepreneurs and other socially committed business groups set aside 1% of the profits for farmers' upliftment, as a reverse reinjection, it would make tremendous changes in the economy. This is part of our national and humanitarian obligation to give back some of our earnings to the most significant basic producers. As we know farmers are basic initial creators in the economic sphere. By re-injecting farmers from other secondary sectors, they are fulfilling their obligation. Further, this will help for a more equitable distribution of wealth to its primary creators. It would be unethical not to assist them when the farmers are still committing suicide in the name of bankruptcy inside the value chain. Increased bargaining power attained by farmers will further boost the economy to a certain extent.

 

C. Areas of assistance :

“If a state has decided to upbring its vulnerable community, the executions are much easier. If the state doesn’t have that intention, the community will always be the oppressed.”

Three main types of support providers can be distinguished: 1] providers of physical inputs, such as seeds at the production level or packaging materials at the processing level; 2] providers of non-financial services, such as field spraying, storage, transport, laboratory testing, management training, market research, and processing; 3] providers of financial services. These are separated from other services because of the fundamental role played by working capital and investment capital for sustained growth.

An example of how financial incentives help the betterment of any sector is amply illustrated in the case of PepsiCo.

The financial incentive was supplemented by capacity-enhancing and risk-reducing elements under a contract growing scheme, a business model that PepsiCo has pioneered in India since 2001. These elements included: free technical extension services; free crop monitoring (i.e. early disease detection); guaranteed markets and prices; on-credit access to quality seed potatoes and other inputs; and weather-based insurance. The model is facilitated by vendors, and local people hired by PepsiCo to act as a readily accessible liaison between the farmers and the firm. This combination of economic incentives drove the rapid growth of the scheme, from 1 800 farmers producing 12 000 tons of potatoes in 2008 to 13 000 farmers producing 70 000 tons of potatoes in 2013. At present, PepsiCo is earning 26 percent of its turnover from processed agricultural products (such as rice, potato, peanut butter, tomato, chilly, garlic and ginger pastes, etc. The company has signed contracts with Agricultural Value Chains in India: Prospects and Challenges 7 Punjab Agro Industries Corporation and Punjab Agricultural University for contract farming and research purposes. The company provides inputs and technology to the farmers. Returns to the farmers have also gone up as now farmers supply agricultural products to the company at an agreed price and for a fixed quantity. Direct involvement of the company’s agents with farmers ensures good quality for the company as well as covers risks to farmers from crop infestation and bad weather etc. (Punjabi 2015).

D. Assistance should specifically benefit the women's community :

Muhammad Yunus

Muhammad Yunus, the Nobel Laureate, has proved the efficacy of micro-financing and focusing on women for assistance. The amount of 1% money should be taken as a fund to assist farmers, especially the women-folk. A substantial part can be used to micro-financing them. It should be noted that Muhammad Yunus' pilot project became a source of inspiration for many countries worldwide. Under the Grameen Foundation, several non-profit initiatives employed people from different sections of Bangladeshi society. Over the years, the micro-finance models found themselves replicated in over 100 nations, including the United States.

Grameen Bank, which is the first social business that was embarked in Bangladesh in 1976, serves more than 8.4 million borrowers, 94 percent of whom are women, and is the only rural bank that is owned entirely by its borrowers. It proved for the first time that the poor, and especially the women among them, were not only bankable but usually more bankable than the rich. More than 200 million people, mostly women, at present have access to microcredit around the world, and studies show they have brought a host of positive impacts to their families and their communities.

 

E. Suggestions for central government’s Intervention :

1. The existing system is not environmentally friendly to start-up entrepreneurs. The exporting policy should be made easy for them. This will improve the whole system indirectly.

2. Reductions in testing rates, encouraging homogenous export quality products.

3. Reductions in export trading platforms registrations.

4. A decentralized platform considering, A rented/leasing cold storage facility, starting at different spots where government institutions have the extra space for cold storage.

5. Subsidizing and giving provisions to trigger the cold storage facility for farmers & MSMEs would reduce the value chain stress at certain points. It also promotes freshness as well.

6. Among the major problems faced by Indian exporters the crucial ones are poor quality image, high costs, unreliability, infrastructure bottlenecks, the inadequacy of trade information system, supply problems, faceless presence, uncertainties, procedural complexities, institutional rigidities, etc. Central government should take necessary steps to eradicate such negative aspects.

 

F. Technology in the form of a savior via Blockchain :

Blockchain technology

More than simple supply-demand equilibria, the agricultural sector has many distortions and dislocations, not just middlemen, but also a very poor supply-chain, with lack of cold storage and efficient transport. While not precisely known, India wastes some 20% of its fruits and vegetables, and highly perishable/seasonal ones (which are often worth much more in rupee terms) may lose more. As economist Ajit Ranade and others point out, a number of improvements are needed in terms of markets, flexibility, etc., allowing farmers to choose whom they sell to, at what terms, etc.

However, agriculture is one underserved sector of the economy that blockchain technology has the potential to completely transform. More importantly, it has a growing list of problems that we must resolve immediately. There are several ways that blockchain technology might benefit the agricultural industry. To manage data and sustain information flow, databases are currently using ICT (information and communication technology). Using blockchain technology to power these databases is a fresh idea. They grant permissions to every member of the network rather than just one administrator and server. The database's new entries can then be accessed and verified by a number of parties, increasing security and lowering the risk of corruption.

Blockchain technology

Blockchain technology has the ability to track a variety of information about plants, including seed quality, crop development, and even the path a plant takes after leaving the farm. This information can increase supply chain openness and dispel worries about shady business practices. They can also make it simpler to trace contamination or other problems in the event of a recall. These technologies' main objectives are food security and sustainability. When consumers have this amount of transparency, they can make informed purchasing decisions. They frequently utilize this information to reward farmers and producers that implement good farming methods.

 

G. Conclusion :

If farmers, the anna data responsible for bringing food to our tables, would be living a happy and content life, the entire nation will be benefited from it. Educating farmers on technical know-how and new agricultural methods to increase productivity etc. are some other suggestions. Agricultural value chains in India are subject to high fragmentation and intermediation, resulting in substantial losses in quantity and quality of produce, limited processing capacities, and high price volatility. Agricultural policies in India have primarily focused on augmenting production, without giving due attention to developing efficient value chains. Further, cereal-centric policies of the government do not adequately recognize the challenges faced by farmers growing non-cereal crops. These policies have led to environmental degradation including fast-depleting water resources in key rice-growing states as well as soil contamination due to unabated use of fertilizers and agrochemicals. The policies lack a holistic approach and long-term direction toward sustainability and scalability of successful value chains across commodities and geographies.

Driven by political will and entrepreneurship, the development of the private and the public sector go hand in hand, with public-private partnerships (PPPs) providing both efficient solutions and effective coordinating mechanisms.

Although the financial industry is where blockchain technology first gained popularity, it has a wide range of uses that go beyond cryptocurrencies. Numerous industries, such as healthcare, law, real estate, banking, etc., stand to be significantly transformed by the technology.

 

 

Actions 

1. Reductions in testing rates, encouraging homogenous export quality products.

2. Reductions in export trading platforms registrations.

3. A decentralized platform considering, A rented/leasing cold storage facility, starting at different spots where government institutions have the extra space for cold storage.

4. Subsidizing & giving provisions to trigger the cold storage facility towards farmers & MSME’s would reduce the value chain stress at certain points. It also promotes freshness as well as

5. Proposal of a decentralized block chain system for government under which the stakeholders in the value chain will have a fairness in equity. This will be a living model platform wherein now we can push the 1% profit to re-injected towards farmers & agricultural upliftment of the state. This living model could be molded according to the changes in reality.

6. This method can eventually bring the most unorganized sector into a single platform with the prime vision of making people understand the fairness of equity in the value chain.

7. Re-allocation of government employees to start a connection network for tradable goods between different nations for private institutions which comply with the 1% reinjection.

8. Free placement of food products in government initiated institutions such a kudumbashree units, Ration shops, triveni stores, ICH, rest houses, government college canteens, hospital canteens, institutions canteens,

9. Importance of value added products from agricultural products & the possibility of exporting more for the coming decade

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