Deloitte Maverick

The Raptors

LIBA ChennaiTanmoy PorelRitaban SenguptaRohit Bhattacharya

Mahatma Gandhi said “India lives in villages and agriculture is the soul of economy”. Irrespective of development and industrialisation, India is still an agrarian economy with more than 50 % of Indian population depending directly on it for livelihood and agriculture contributes approximately 16% of the GDP. Due to vast expense of land, wild climate variations, inadequate coverage of orgainised credit institutions, lack of access to or knowledge of seed and farming technologies, poor infrastructure (electricity, irrigation, storage for perishables, processing capacity shortfall, etc), and an inefficient market there is high yield gap and low value generation in agriculture. The sector is still considered as a livelihood sector rather than a business sector and fails to draw investment towards it.

The idea of embedding technology into agriculture is not a new one but an holistic approach has been missing in the sector and the initiatives taken has only reached till experimentation stage. Based on our primary and secondary research we have chosen the segment of marginal and small farm holders. We strive to create a smart and balanced eco-system for farming including all the stakeholders of agriculture industry fueled by Information Technology. Due to lack of infrastructure direct application of IT is not possible in agriculture but IT can be used as binding thread to bring together the members of the eco-system who are scattered and unorganized now. We would introduce sustainable intensification using technology enabled services and technologically advanced inputs. We have introduced ‘Krishi consultant’ who will serve as an one-stop solution for farming needs. This will help to bridge the yield gap, increase productivity. The monetary benefits can be injected back into the eco-system to make it sustainable. Next we designed a resilient and effective supply chain to support the eco-system. The supply chain has been divided into two stages: farm to market and market to fork. In farm to market we have introduced a specialised agency which will eliminate innumerable middlemen and will provide marketing and logistic services. In market to fork we have brought in standardization by converting commodities to products using technology.

As India moves towards development and better infrastructure, these reforms are bound to happen. Better today than tomorrow. We strongly believe that laying a foundation for future sustainable growth supported by ICT (Information and

Communication Technology) is the only way to improve the sector and make it profitable.

Executive Summary

Primary Research Village Name : Khurigachi, W.B. Farmer’s Name : Kanhai Porel Crop : Rice Input Cost : Rs 17600 per Ha Revenue : Rs 23100 per Ha

Market OverviewTarget Market

Marginal and Small land holding Contributes to 84% of

operational holdings Increase in access to irrigation The average size of land holdings

in India fell from 2.82 ha to 1.16 ha between 1970 and 2011

The fertilizer per hectare is inversely related to farm size

High multiple cropping index High value crop for higher and

quicker returns Contribution to output is higher The cost of cultivation per

hectare is high

Yield Gap and Low value creation1

Imperfect markets for inputs/product – lower value realisation

Lack of formal education and skills Smaller access to suitable extension

services – restricted decision making in cultivation practices

Poorer access to ‘public goods’ e.g. public irrigation, command area development, electricity grids

Greater negative externalities – poor quality land, poor water management

Inefficient demand forecasting – farmers try to push what they produce2

Sustainable IntensificationA form of production wherein “yields are increased without adverse environmental impact using same or less resources”

Smart eco-system

Sustainable Intensification

Technology Enabled Services

Technologically Advanced Inputs

1:Small farmers in India : Challenges and opportunities, IGIDR 20122:Can India be food basket for the World? – working paper series ISB.edu

Technology-enabled smart eco-system

Krishi Consultant

Financial ServicesInsurance Services

Climate Risk ManagementSoil Fertility

ManagementCrop Scheduling

Risk mitigation servicesWater Management

Training & DevelopmentForecasting Services

FertilisersSeeds

PesticidesIrrigation

Farmer

Informed decision making

% of revenue

Value addition & Service enhancement

Real time info & advice

Krishi Consultant will act as a single point of contact (SPOC) All technology enabled services are integrated and co-dependent Consultancy charges are based on revenue generated rather than a fixed fees Crop scheduling and Forecasting services – better demand planning, production according to

the need of the market Climate risk management and risk mitigation services – risk associated with investement and

methods to reduce it (insurance services) Soil fertility management and water management – Better allocation of resources and optimal

usage Training & development – Increase in awareness, making the farmers more equipped

IT enabled agriculture1

IT as a strategic tool Awareness Database :

Unambiguous Interpretation with implications

Decision support system (DSS) : facilitate farmers to do SWOT analysis for appropriate decision making

Bricks and mortar to click and mortar : Appropriate alliance for collective benefit Remove geographical barriers Generate cross border employment

opportunities Monitoring : Advance warning

systems and periodic analytical reports

Kiosks, Telecentres and Smart services Non linear development Lack of localisation and user friendliness Lack of infrastructure for direct use :

Precision agriculture Kiosks : Dissemination points, multiple usage Mass deployment required Service providing model to revenue generating

model Training and Distance education E-insurance and E-financing Local sourcing

Telecentres Localised services and information Attracting private investments from rural

entrepreneurs Smart services

Still in experimentation stage (mKrishi, Reuters Market Light)

Mobile phone usage in rural India growing

Benefits Integrated approach to

agriculture with collaborative demand forecasting

Since IT is mostly private sector so attracting private investment

IT infrastructure improvement and deeper penetration

ICT (Information and Communication Technology) will help to address the untapped potential of rural India

High rural teledensity Cost effective and eco friendly

solution Promoting a centralized system

in an advisory role to coordinate among specialised institutions and evolve standards

1: Role of Information Technology in Agriculture and its scope in India, S.C. Mittal

Sustaining the eco-system

Rice (Mg/ha) Present average yield (rice) : 2.9636 Yield potential rice : 5.6272 Yield gap to be bridged : 2.6636 Monetary Benefits per hectare : Rs 111872.7273

Bridging the yield gap Wheat (Mg/ha)

Present average yield (wheat) : 2.85 Yield potential wheat : 4.9375 Yield gap to be bridged : 2.0875 Monetary benefits per hectare : Rs 31103.575

• Logistic scheduling• Loading/Unloading facility• Marketing of goods• Cold Storage /warehouse

facilities• Inventory planning

Payment in cheque

Charge % of profit generated

Crops produced

SpecialisedAgency

Farmer

Farm to market – Stage I

Benefits If the eco-system is implemented the

yield gap can be bridged/minimised This in turn will increase the monetary

benefits per hectare of land The monetary benefits reaped can be

injected back into the eco-system

Farm

Harvesting Storage MarketFarm to Fork (SCM)

Farm to Fork contd.. Market to fork – Stage II Processing Packaging SalesCommodity to Product Benefits

Standardisation Fosters transparency Prevents supply chain stake holders

from exorbitant price margin Back tracking Sales data collection

Results Transparency in supply chain Efficiency in supply chain

Process Risk identification Risk prioritization Risk mitigation

Supply Chain resilience

Implementation Sorting & grading of the product at

the start of supply chain Assigning Unique Id (RFID/QR Code)

Conclusion

Sustainable Intensification

Profitable Farming

Technology based smart eco-system

Interdependent

Increase in productivity per hectare

Eco-system Resilient supply chain

Logistic Services

Marketing Services

Specialised Agency

Value Generation

Result

• Reduce yield gap• Transparency in

supply chain• Prevent some

stakeholders from gaining exorbitant margins

54% population still dependent on agriculture (only 16% GDP contribution)

Still a mode of livelihood rather than a profit making business

Push to market what is produced tendency High yield gap due to inefficient supply

chain, lack of access to knowledge of seed and farming, poor infrastructure capacity planning

Thank you

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