Farm-based Social Enterprises | Many shades of innovation in agri-businesses

 

It is a very long held view that innovation in the farming sector in India has meagrely progressed since the green revolution of 60s and 70s. The drastic change in that period brought high-yield varieties of seeds at the fore-front, along with major improvements in irrigation methods and soil nutrition. It is a common argument that the farmers in India continue to follow the paradigm established by green revolution until now, even though the natural and economic factors demand revolutionary changes in agri-sector once again.

Bold Experiments

For a respite, a bunch of innovation is finally breaking this state of impasse. The entry of a handful of social enterprises has brought a structured thought process, access to global knowledge base, bit of private investment and a horde of raw enthusiasm in the farm sector, promising to mend the missing link of experimentation on Indian farms.

For far too long private entities have looked down upon Indian agriculture as an opportunity-less arena, giving them no chips to introduce new products and services, customized specifically for this sector. However the new crop of social enterprises are making bold moves, expressing their confidence in the farmers’ capacity to respond positively given a chance.

A good example would be Cropin that uses a suite of software and mobile apps powered by GIS and data science to deliver a range of services to not only farmers but also other entities in the business of agriculture. Cropin has built mobile applications that feeds real-time data and advice on package of practices followed on particular crops. Another Bengaluru based company Flybird Farm Innovations offer sensors that use accurate soil moisture and soil temperature values to predict irrigation needs of a farm land. While Aarav Unmanned Systems have built a Quadrotor UAV assembled with accessories that can process aerial images for large scale land surveys and crop monitoring. Grassroots practitioners certainly dream to access such powerful technology simply because it clears two main limiting factors in agronomy- generation & analysis of crucial data and precise & faster decision making.

Innovation for Small Farmers

However observers and development professionals do not see an immediate answer to the problems of small farmers in the expensive and complex technology and analytics. This is an important point because 67 per cent of farmland in India is held by small farmers. So a company looking to scale and tap country wide consumers has to look at developing solutions that the majority is willing to try. Such as Ecozen that has launched a solar-powered micro cold storage that company claims to be affordable and portable. With this facility available locally, a farmer can sell at better prices by keeping for himself a wider room to hold the produce. Similarly a very promising EM3 Agri Services is trying to close an apparent gap in the demand for heavy farm machinery like tractors by providing it on pay-per-use basis. It is a fact that most farmers in India are financially incapable to buy heavy farm machines.

Hence the fact remains that farm focused social enterprises need to understand real challenges of farmers in the country to get any significant success. And these solutions do not lie solely in technology. It is evident by the performance of so many procurement start-ups like Parvata foods and Safe Harvest. By directly marketing the produce to urban retail points, these companies target a major problem of unfair market prices to farmers, and as a plus encourage them to adopt healthier farming practices.

The recent innovation in farming has also shown that the solutions may not at all be about bringing in a new product or a business model. Instead perusing public policy to accentuate on existing ideas so as to make them work effectively can also radically bring the change. The introduction of forward contracts in the business of farmer producer companies (FPC) is one example of smartly exploiting the policy. Once registered with NCDEX a FPC can take futures position at a specific price for a commodity (allowed to trade by exchange) shielding henceforth all its members from any price fluctuations or price dips.

Opportunities in the Unconventional Zones

This article also inadvertently puts a focus on the kind of innovation at the side of investors who are keen on agri-sector. It is important to remember that the most distressed farmers and the farm lands exist in the most backward blocks in the country. Hence it illustrates a situation for investors to start looking at the potential in the low income states in Central & Eastern India along with the Himalayan region where majority of the 200 backward blocks exist. An exciting initiative in this respect is recently launched INVENT programme that aims to incubate social enterprises with a specific focus on the 8 low income states of India. Although few more funds have to carve their path out to the non-metro zones before we start seeing volumes of activity and experiments on Indian farms.

Together these models show that it is not a good judgement to explore innovation merely in a single area. Technology, data analytics, financial precision, marketing strategy, community mobilization, institutional design are just a few playgrounds of innovation in farm sector. And it never ceases to surprise.

A version of this article was published at YourStory on 25 October, 2016. Here:  https://yourstory.com/2016/10/farm-based-social-enterprises/

 

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