65% of India’s Population live in rural areas and contributes 35% in India’s consumption, although agriculture accounts for 16.5% of India’s gross domestic product, nearly half the population in the country depends on a farm based income and creating pressure on farming importance for livelihoods. The corona pandemic has pressured farm incomes and affected farm to fork supply chain, despite full exemptions to the farm sector. Due to national lockdown, labour shortage and empty wholesale markets led farms to dump new harvest of perishable nature.
The incentives announced by Government in
last two years have already boosted the per capita income of farmers by 20% to
30%. Government intent to double farmer’s income in emerging Indian economy to
bring it near to world standards. It will result in increased spending of
farmers and boosting domestic consumption economy in India at large.
India need to focus on various sectors and integral aspects of farm to fork chain to play this theme, which drives the consumption in agriculture activities. With a shortage of cattle dung and bio compost availability, farmers need an alternative to improve soil’s fertility. Soil needs three sources to improve its fertility; Fertilizers, Minerals and Manures. Soil management will bring higher productivity and increase per capital income. Then comes the storage facility at produce level; wherein government has announces various schemes, subsidies, loans and preferred funding. Farmers can directly setup storage silo, warehouse, cold storage, temp controlled areas etc.
The Indian agricultural market is fragmented and every state has its distinct regulations. Agriculture Produce Market Committee Acts mandates restrictions on where farmers can sell and to whom. Reforms are bringing it on uniform level across country, as one India one mandi. Regulator working on new legal framework, governing investment and technology in agri-economy could bring expected boost in farm to customer connectivity.
Government is working on a massive scaling up of a national e-commerce platform for farmers and traders, to be known as e-nam app. Its observed that more than 166000 registered farmers across the country are now selling their produce by transactions from home with better price recovery. With this movement wholesale food markets in large states have joined the digital supply chain to raise per capital farmers income.
It is suggested that corporate procurement chains shall join this digital movement of farm fresh purchases. Entrepreneurs shall start new digital business ventures to connect nearby areas with cluster of farmers, wherein they can get easy access to world markets with priority seed funding under various government schemes, working capital funding, equipment funding, storage financing, warehouse financing, technology loans etc. Lets gear up to bring rural India in pace with urban, by increasing per capital income of rural farmers.
(The author is subject expect of Economy and Funding advisory for projects)
Birla WP Management
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