How can we double small & marginal Indian farmer’s income?
AgriTech sector is growing in India right now. In past few years, the industry has seen many startups come in with different solutions to tackle some of the most pressing problems faced by farmers in India. Many of the solutions use technology as a means to achieve scale, set up processes and reach larger number of beneficiaries. Although some of the solutions are still manual in nature and manpower intensive.
These solutions are often built around a common theme — increasing farmer’s income. India has a large farmer base comprised of small and marginal farmers. These farmers contribute to nearly 70% of landholding in India. The average operational holding by a farmer has also slowly declined over years. Therefore, it is crucial to empower these farmers with modern solutions and improve their socio-economic status. India’s current administration has also repeatedly mentioned this over past year and made it part of the Government’s agenda to “Double Farmer’s Income” through various schemes and policies.
The potential solutions targeting the stated income gap can be executed in many different ways. In this article, we talk about 4 possible solutions to increase small & marginal farmer’s income based on our experience and understanding of the sector for past 2.5 years of being operational. Our platform is actively solving some of the reasons mentioned below on day-to-day basis.
Reducing pre-harvest and post-harvest crop loss
Crop loss from farm-to-fork can reach as high as 40% for certain crops in certain seasons. There are myriad reasons behind this. Some of the key contributors are — inefficient supply chain, lack of appropriate storage facilities, mismatch between demand and supply etc. The crop loss can be divided broadly in two areas.
Pre-harvest crop loss happens due to farmers not knowing when to harvest and how much to harvest. Typically during harvest period, farmers would want to sell their crops as quickly as possible if there is a buyer. If bulk of the crops are not yet ready to be harvested, this would lead to inferior grade which often gets rejected by the buyer. Similarly, due to lack of buyers, if farmers are too late to harvest their crops, this would also lead to similar problem. Knowing the appropriate time to harvest along with proper demand of the harvested crops are crucial to the farmers.
Post-harvest crop loss happens after farmer has harvested their crops and ready to sell. Majority of crops have limited shelf life. Due to this, clock starts ticking for the harvested crops before it reaches in the hands of end consumers. Efficient inter-state and intra-state logistics, proper access to market and better storage mechanisms can help in reducing post harvest loss up to a great extent. Furthermore, reduced crops loss will help farmers in gaining better income for their crops.
Removing middlemen from agri supply chain
In a typical agri supply chain, 3 to 5 layers of middlemen exists between farmer and consumers. These middlemen add their own markup to the crop price resulting in an inflated final price. Often consumers end up buying the same crop at 3x price than what farmers sold. Bypassing these middlemen and providing a platform to small & marginal farmers a platform to sell their crops can result in higher income for farmers and savings to consumers.
Through a demand-driven supply chain platform, KrishiHub is doing exactly that. We procure crops directly from the hands of the farmers and enable them to get better price realization. As of today we have procured crops from close to 2000 farmers who are located in different districts in Uttar Pradesh, Punjab and Haryana. By selling to KrishiHub, farmers have been able to gain 15–20% better price realization compared to traditional market or middlemen. Moreover, our platform provides complete transparency to farmers in terms of pricing so that farmers are able to distinguish between current market prices and price offered by our platform.
Educating farmers on modern farming practices
Many of Indian small & marginal farmers follow outdated farming techniques. Moreover, they are unaware of many modern techniques that will result in higher yield and productivity in their farm. Lack of proper skilling and information gaps are some of the reasons behind this. Farmers often are not aware of these information or not able to access them due to language barriers. India speaks many different languages but these information are not readily available to them in their regional languages. Central and state Governments have many schemes which can potentially tackle many issues but farmers simply do not know how to unlock them. Modern agri advisory in multiple regional languages through different medium (text, image, video) can enable farmers maximize productivity and gain more income on their farm without increasing landholding.
Through our advisory platform, we enable farmers to learn about modern farming practices and access information in order to make data driven decisions and improve productivity. By supporting 7 languages on our advisory app, close to 30,000 farmers across India are accessing information easily. We provide crop calendar, information, disease management and best practices for over 50 regular and organic crops. We also provide price visibility and forecast of crops across all major markets in India. Apart from this, farmers can ask questions and discuss solutions in a social forum, get access to nearby agri inputs sellers and receive weather forecast and alerts. From our experience, these advisories prove crucial to farmers for their day to day farming activities. Based on few pilot projects done in the district of Hapur, Uttar Pradesh, farmers have successfully integrated our advisories in their daily farming practices and have been able to increase their productivity and income significantly over a crop cycle.
Instilling sharing economy mindset
Some of the main challenges faced by small & marginal farmers in India are their landholding size and spending power. This limits them from owning farm machineries like tractors and harvesters. For a landholding of a couple of acres, it is not viable for farmers to own machineries and equipments solely for his own farm. It is also expensive and often out of reach to purchase modern machineries with limited income. Therefore it is beneficial for small farmers to rent machineries depending on their need instead of owning them.
There are few startups operating in India which enables farmers to rent machineries like tractors and harvesters on hourly basis instead of owning them. This is extremely helpful for a small farmer to receive such services in on-demand basis based on his harvest schedule. Often a group of farmers in a village would rent machineries on hourly basis and use according to their requirement. This reduces large capital expenditure and minimizes burden from farmers. These days many FPOs (Farmer Producer Organization) are offering such services to farmers associated with them which is a step in the right direction. Building a collaborative and sharing mindset will enable more and more farmers adopt modern farming techniques, reduce expenses and generate more income.
Lastly, we believe that despite many challenges present in Indian agricultural landscape, we are stepping into the right direction. More startups coming in to solve farmer’s problems, active participation from Government and using modern technology will lead to empowering of small & marginal farmers and vastly improve their socio-economic status.