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Evolution of mKRISHI®: A technology platform for Indian farmers

Thursday, 15 of December 2016

$1.25

Business Info. Facility, December 2013

Business Logic

Presented by:

Business Logic Continuation...

India

mKRISHI® & TCS

Why? How?

Presentation Outline

TCS - Tata Consultancy Secvices

mKRISHI®

Bo Ratha

Carolina Lopez

Eliana Gerardi

Nang Tun

Brief Country Context

Companies Description

Business Logic

Development Context

Business Impact

Development Effectiveness

Conclusion & Recommendations

  • mKRISHI®’s value proposition is to increase agriculture productivity, create fair/ transparent markets and collectivize farmers.
  • Increase Tata Group’s presence in all areas of the agriculture value chain
  • Location - shares land borders with Pakistan, China, Nepal, Bhutan, and Bangladesh
  • Population - religions and languages. 1.2 billion people
  • Economy - service sector makes up 55.6% of the GDP, with agriculture sector 18.1% and industrial sector 26.3%

A for-profit rural services delivery platform that caters to the needs of smallholder farmers.

Falls under the TCS Innovation Unit of Tata Consultancy Services (TCS).

Enables two-way data and information exchange between the end-users and repositories of knowledge.

A major IT services, consulting and business solutions firm in India, and one of more than 100 companies that are part of the Tata Group.

A multinational conglomerate and holding company headquartered in Mumbai, Maharashtra.

Founded in 1867.

30 publicly-listed Tata enterprises with a combined market

Project Design: 

Development Context

“Before Tata came to our village, when there was a problem due to pest infestation, we used to take a sample of our plant to the store and ask the shopkeeper for suggestions. The shopkeeper used to recommend and push expensive products that we could barely afford. We knew we were being cheated and that something had to be done, but what could we do? We were crippled by lack of information and alternatives.”

Mathurai Veeran, farmer from Tenpakkam village

  • Focus on technology platform
  • Two-way data and information exchange
  • Agro-advisory advices to individual farmer
  • PRIDE model

Development Benefits & Skills:

Critical issue:

Design Objective:

Sources for revenue-projection in the next 10 years

Challenges:

  • Self-awareness
  • A sense of direction
  • Improved focus and effectiveness
  • More motivation
  • More fulfilling relationships

Why Agriculture sector?

Sources for revenue:

  • Financial issue
  • Dependence on Middlemen
  • lack of information and alternatives
  • Low productivity and efficiency issue
  • Traditional farming
  • Knowledge deficit
  • Lack of Infrastructure
  • Irrigation infrastructure
  • Market infrastructure
  • Transport infrastructure

  • Establishing communication of server with the sensors in the field
  • Weather station and sensors did not perform well during monsoon
  • Taking time to convince the government to participate in the field
  • Farmers were initially unwilling to pay for this service

-65% of population depends directly on agriculture

-3/4 of India’s families depend on rural incomes.

-770 million or 70% the majority of India’s poor are found in rural areas

-food production jeopardy

  • to expect recommendation
  • to access information
  • Respite from middlemen
  • to increase agriculture productivity
  • to create transparent and equitable markets
  • to collectivize farmers into groups in an effect to increase their bargaining power

4. Advisory Charges- Membership 41%

5. Crop Consultancy 21%

1. Transaction margin(input supplier) 3%

2. Transaction margin(retail partners) 24%

3. Animal Husbandry Services 12∞%

Generated by:

mkrishi:Business impact

CHPCL: Business Impact

Business Impact

Farmers (surveys show that the are willing to pay) In other regions farmers are already paying in the range of $1.50 to $9.50 per farmer per season

+

mKRISHI is considering charging the PRIDE (licensing and transaction fees)

mKRISHI

  • Estabilished in November 2012
  • Supported by mKRISHI
  • Capital investment of $15825 from farmers registered as shareholders
  • Earns a 10% margin from buying and selling inputs and product
  • 4750 registered farmers(total capacity of 8500)
  • TCS invested $5 million in mKRISHI
  • Not revenue generated
  • Expected profits starting from 2016
  • Revenue of $104-153 million expected in 2023
  • Monetise the platform and hit revenue of roughly $45mn in 2018

Impact on the value chain

  • 2006 mKRISHI was born as an agro-advisory platform
  • 2009 1st small scale pilots in Maharashtra, Uttar Pradesh and Punjab
  • 2012 full operations in 3 districts of Tamil Nadu

  • Turnover:
  • CURRENT: 1.5~2 tons/day with profit of 16$/day
  • EXPECTED: 50 tons/day with profit of 320$/day
  • Maharashtra and Uttar Pradesh farmers pay $1.58 each season
  • Gujarat Noble Cotton is paying $12 per month on behalf of its farmers
  • Farmers in Tamil Nadu are currently not charged for service

On the experience of the initial pilot, the team realized that the mKRISHI project would be successful just when the farmers can have a better access to credit, inputs and markets

Impact on farmers

PRIDE: Progressive Rural Integrated Digital Enterprise

CHPCL: Chennay Horticulture Producer Company Ltd

-Empowerment of farmers in group and clusters

-Improved access to markets and marketing facilities

-Employment generation for people in the local community

-In the medium long-term reduced negative impact on environment

-Middlemen will lose revenues as functions has taken by PRIDE

Estimated Impact on Small Farmers in Tamil Nadu

Source: Eliana

5 Components of of the Sustainable Livelihood Approach

Conclusion & Recommendations

References

Development Effectiveness

Present state: very limited financial access, lending and borrowing.

Aim: more disposal income. Established credit lead to access to the lending and borrowing credit market.

-No information on why they chose the three areas

-mKRISHI developed an application that is compatible with all mobile technology

-Allowed farmers to save messages offline to be sent at a later time. This helped address the loss of messages due to network connectivity issues.

-Lead to a better standard of living in rural communities and the modernity can be experienced as a human construction.

- Even though mKRISHI was very motivated and passionate about making a difference. This is more like a business proposal instead of a development proposal.

Impact on Poverty

PRO: Direct Financial Benefits

Socio-Economic Well-being

iii. Total increase in profit by 88%

i. Total increase in yield by 15%

ii. Total decrease in cost by 19%

PRO: Better living standard leads to better community

CON:

Present state: there is no established buyer and supplier relationship.

Aim: ultimately, marketing scheme to get better price for better produces. This way they can increase household income.

i. Better school

ii. Better hospital

Present state: rural setting, therefore traditional farming.

-Education level

Aim: educated/raise awareness to farmers.

Inequality

i. This is only applicable to the mKRISHI customers in the selected village. The same is rather small to make assumptions on the whole rural village effectiveness.

CON:

ii. The size is small and any conclusions

-Rural Service Delivery Platform Photo. 2011-2016. Available online. http://www.tcs.com/OFFERINGS/TECHNOLOGY-PRODUCTS/MKRISHI/Pages/default.aspx

-Flag of India. Available online. http://www.mapsofindia.com/maps/india/national-flag.htm

-Map o India. 2011. Available online. http://www.cocohol.com/indian_tours/india_tourism/india-map.php

-Country Profile: India. Library of Congress Country Studies (5th ed.) Library of Congress Federal Research Division, December 2004.

-Inclusive Growth and Service Delivery: Building on India's Success. World Bank. 29 May 2006.

-Business Impact Photo. available online. http://designexpo.businessfightspoverty.org/showcase/progressive-rural-integrated-digital-enterprise-pride/

-Nikam, V. Can mobile revolution supplement the second green revolution in agriculture?. The Dialogue. 2016. http://www.thedialogue.co/can-mobile-revolution-supplement-second-green-revolution-agriculture/

http://www.worldbank.org/en/news/feature/2012/05/17/india-agriculture-issues-priorities

http://www.iimahd.ernet.in/egov/ifip/feb2015/srinivasu%20and%20sampath%20selvan.htm

http://www.ripublication.com/ijafst_spl/ijafstv4n4spl_11.pdf

PRO: Increase in income might lead to better education enrollment rate, health care, and living standard

i. Environmental cost

ii. Population control

-Raise awareness on environmental costs

-How the income can be use

-Do more studies - 20 farmers

i. Family will be able to enroll both girls and boys in school

ii. Everyone in the family will be able to receive basic health care

iii. Everyone in the family will be able to afford basic household = facilities

CON:

i. There is not evidence or example on how the wealth will be distributed

ii. The ones which are better off; will be able to get the first pick and continue to prosper

iii. There is no specific agenda to gap gender equality

iv. All the equality development would only result from reduce poverty

Present state: rura area with limited access to information.

Aim: provide the information gap at minimal cost to farmer.

-mKRISHI provide the most cost effective solution.

Present state: traditional farming, relies heavily on the natural rain.

Aim: to maximize the land usage with crop rotation. More innovative farming to limit the risk.

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