Time for a Radical Re-think on Agriculture?

This post has taken help from the articles mentioned at the bottom and has been written inspired by some posts by Anshuman Narain on Facebook.

Food in India has been associated with divinity for a long time. It is said to be the sacrificial offering to the fire in the human body. Krishna says in the Gita that he is this fire. He also talks about how food ultimately comes because of our deeds. There are concepts like annapoorNaa, Saakambharee and annalakshmee. Hence in this land, as an extension the producer of this food (the farmer) deserves a place of honour.

Of late and over many years, we have heard tales of farmer distress, crops getting destroyed due to various reasons, suicides etc. We see this happening year on year. Every time this happens there is a huge hue and cry by whoever is in the opposition, the media highlight and furiously debate it, the government promises relief measures and then everything is forgotten till the next calamity. Rightly or wrongly farmers are one of the largest voting groups and hence wield immense power. Many of our political leaders were farmers (they still claim to be when one asks them for their profession, the latest example being the Karnataka CM). I am not an expert but some of our problems are well known:

1. Fragmented land-holdings
2. Poor irrigation and hence over dependance on rains
3. Low penetration of crop insurance (the other side of the coin being insurance frauds)
4. Poor efficiency and hidden unemployment (GDP contribution ratio to employment ratio is low vis-a-vis, say, service).
5. Skewed markets favouring middle men.
6. Controversial procuring mechanisms (think of the debates over MSP or minimum support price)
7. Inefficient and insufficient storage for procured items.
8. Poor transportation measures increasing time gap from farm to plate.

When we are under the Britishers we had them to blame. Who do we blame today? On one hand we have hailed dams as the temples of modern India, on the other hand we have the Narmada Bachao Andolan and opposition to the Tehri Dam. Further I understand that in today's India, where there is huge discussion going on about tax evasion and black money, agricultural income is not taxed at all.

We have seen a huge movement against corruption which was apolitical. It is a different matter that this led to the formation of another political party. We have a PM who seems to be in a hurry to change the country. Can he not ask for a radical overhaul of our agricultural system?

1. Completely decentralize agriculture - the central government is too far, empower the gram panchayats.
2. Keep a stringent central monitoring mechanism in place - the local bodies should not monitor their own activities.
3. Comprehensively EDUCATE people, especially farmers on the benefits of pooling resources, ensure formation and efficient working of farmer cooperatives - better bargaining power. Also we have to ensure that farmers are actually educated and not left illiterates.
4. Invite public and private companies to invest in roads and storage infrastructure (both normal for dry crops and cold chain-related for fruits and vegetables).
5. Link NREGA and farming comprehensively. NREGA should be comprehensively linked with developmental and productive activities.
6. FINISH the discussion on inter-linking rivers and either dump it or start it. Lot of rivers, especially the non-Himalayan rivers see significant drop in their flows during the dry season. Interlinking can probably help to even out the flow and reduce dependance on dams - we can focus on irrigation canals only instead. These canals can be used in two other ways - to cover them with solar panels like it has been done in Gujarat, and also as transportation channels revolutionizing rural transport.
7. Apart from helping improve irrigation we should also focus on drip irrigation. Imagine the increase in productivity and production if we can convert areas like the Kutch, Thar Desert and interiors of Odisha, Telangana etc. for agriculture!
8. Increase efficiency and reduce over employment - for this we need extensive coverage of high yield varieties, access to fertilizers and pesticides, good farming practices.
9. At the same time we should protect our bio-diversity and increase use of natural and organic methods. We have an abundance of cattle wealth. Their dung and urine can be useful as manure. Further varieties which have been traditionally used may be more resistant to heat, pests etc. Traditional knowledge should be tapped to the fullest extent possible.
10. Inform people about crop insurance. However this alone will not help as many may not be able to afford it or may become ineligible for insurance payouts once they default on their loans. This is the reason I keep coming to consolidation and cooperatives. 
11. There should be clarity on MSP. Increasing MSP can help farmers, however this leads to inflation which will impact the normal middle class anyway. The increased inflation may come back to hurt farmers again.
12. We also need to realize that we are a country where only a small percentage of the population today pays income tax. At least the larger farmers who own significant holdings should be brought under taxation. This is not related to agricultural reform. However I wanted to bring this up while I am on this topic.
13. Get comprehensive changes to the PDS (public distribution system). There is no point in procuring huge quantities and then squandering them. The correct recipients should be properly targeted. Aadhaar can play a huge role here.
14. Rationalize our APMC system, reduce the role of middle men and ensure benefits go directly to farmers. The efficiency-related savings can be passed on to consumers.
15. To do all of this there is a comprehensive centre-state debate required. People have to sit together and hammer things out.

We have people like APJ Abdul Kalam, MS Swaminathan and Narendra Modi who have vision. It is high time we think big, think radical and change our agriculture for good.

References:

• http://economictimes.indiatimes.com/news/economy/agriculture/why-crop-insurance-schemes-fail-poor-farmers-when-they-are-needed-the-most/articleshow/47052185.cms
• http://www.livemint.com/Politics/bYMbXRsL3eYQw2Bp4iMaXI/Narendra-Modi-promises-higher-support-price-to-farmers.html
• http://www.dnaindia.com/india/report-quiet-reforms-by-narendra-modi-double-edged-sword-2040061
• http://economictimes.indiatimes.com/news/politics-and-nation/view-new-land-bill-will-win-not-lose-votes-for-narendra-modi/articleshow/47057364.cms

On Net Neutrality - Part 2

This is in continuation with my earlier post. First of all I am happy to report that Mr. Gopal Vittal, MD and CEO of Airtel (South Asia) has put out a clarification which in many ways echoes what I had written earlier.

Further I feel that we seem to be hearing only apocalyptic and hysterical views on net neutrality. Those supporting net neutrality have a good point to make. However they are not talking about the other side of the coin - how to compensate the huge investments made by companies, issues of security etc. As an added example look at Alok Kejriwal's post in today's Economic Times. He gives advice, talks about why net neutrality is needed. It would have been nice had he elaborated further on his advice. The TRAI chief has come out with a statement where he advises saner discussion.

So I am writing this post to talk about a few steps which can be done in this direction.

1. The government can reduce the price of spectrum or increase the quantum of spectrum available for telcos. This can take away the argument about bandwidth-intensive free applications hogging bandwidth and also about the need for returns of huge spectrum-related investments. However given the government's stand today the possibility of the former happening. However the government can surely look at increasing the quantum of spectrum available.
2. Telcos can look at launching this product first for in-house customers. For example make accessing customer service portal free. Then this can be extended to other companies for their premier customers (only). For example,  banks have high net worth (HNI) and private banking customers. Plus they have a clientele (like Premiere Banking for ICICI Bank) where the customer is not a private banking customer but puts in money above a certain quantum every month. Amazon and Flipkart offer some additional services to customers who pay a membership fee. These companies can extend services which consume bandwidth to these customers using the toll-free data (TFD) platform.
3. Gopal Vittal has clarified that airtel stands and will continue to stand for net neutrality. However, now I will take an extreme case now. Taking a worst case scenario in the future, if net neutrality is breached on the basis of better speed for extra payments - the government can always put in a minimum threshold of speed whereby the slowest speed must be equal to or better than the average speed available where no extra payment is made.

Any further thoughts are welcomed!

On airtel and Net Neutrality

First of all a disclaimer - I currently work at airtel, specifically airtel Business which is the B2B enterprise division. While I may justifiably be accused of having a bias, it also gives me an opportunity to have some idea on what I am talking about. Further I am writing this in a purely personal capacity, on MY  personal blog. This is in no way an official statement.

There seems to be a debate raging on how airtel has "dealt a blow to net neutrality" by its alleged tie-up with Flipkart, so much so that the company has also felt the need to clear the air. Apparently the defence put up by Flipkart has been "debunked". Refer to this. I am all for net neutrality, but thought I would share my perspective also.

Now before I clear a few things up let me share some background information. Today we consume broadly two kinds of services via mobile phones - voice and data. Though the backbones to carry both would be the same, the ways they are treated in are different due many reasons - technological, historical and especially important in the Indian context, regulatory. At the risk of oversimplifying, voice includes SMS and (normal) calls. Data covers everything provided via 2G/3G/4G - Internet on mobile phones.

Further India is one of the most competitive markets in the world where we have had many players per circle, more than in (especially) western markets. This led to all the operators bleeding badly a few years back. In the past few quarters telcos have been doing away with freebies and now it is being said that there may be an actual increase in rates also. Why is this? Telecom is a highly capital-intensive sector and returns accrue over years if not a decade. Telcos spend thousands of crores on acquiring spectrum. Especially after the so-called 2G scam this is more and more being treated as a natural resource which can only be auctioned and not allocated. Further there is a revenue-sharing concept where the telcos have to pay a portion of their revenues to the government.

Given this background services like Whatsapp and Viber started eating into SMS revenues and then voice revenues also. Due to hyper-competition rates had fallen and as I said earlier there is now a correction underway. This is the background in which airtel decided to launch specific packs for the so-called over-the-top (OTT) players like Whatsapp. Simply put OTT players provide services that are directly consumed by you and me without an intermediary like a cable operator. It can be argued that this is against the concept of net neutrality. However I would like to give some context here. Facebook has an initiative called internet.org which is about providing "affordable" Internet access to consumers. The problem is that Facebook is not making any sacrifices here. The people making the sacrifice are the telcos who provide the access. Facebook is free for users. It does not charge entry fees. It makes money via ads. So there is clearly a selfish motive behind this "affordable Internet". This has been criticized by telcos as this is charity with someone else's money.

Further there is a regulatory point to be made here. Whatever is done by the telcos In India the government wants something called lawful interception (LI) to be available. Whether this is desirable or not is a separate point and is not in the scope of this post. Under LI the government should be able intercept and decipher all communication. Telcos have to provide such facilities to the government. Monitoring OTT players is not that easy as the servers are not hosted in India. Similarly cloud is a concept that is rapidly catching companies' attention today. However PSUs/government does not have so much. Rightly or wrongly there is an impression that a cloud service is less secure. This is probably a major reason why Microsoft is now planning to set up data centres in India. However I am digressing.

Now coming back to the idea behind this post, in voice services there is a concept of toll-free number. Basically the caller does not get billed. The company taking this service gets billed on behalf of its customers. This is mostly used for customer care and for sales enquiries. All the 1800- numbers we see are Indian toll-free numbers. What airtel is launching now is a similar concept, but for data services. This is called toll-free data (TFD). There are a couple of points to be noted here.

1. There is no preferential access given to say a company which has signed up for this over any other. Thus if Flipkart signs up and Snapdeal does not, all Flipkart and Snapdeal customers visiting the respective mobile websites will be able to access them at the same speed. However only airtel users visiting the mobile website of Flipkart will not be charged. These charges will be borne by Flipkart. However as pointed in the "debunking" article above it is true that in this case even after the data pack (1GB, 2 GB etc.) is exhausted speed of access to Flipkart may not decrease (like it would for a non-Flipkart site). I will return to this point shortly.
2. With toll-free voice we do not hear accusations that the telco is supporting company X over Y by providing it a toll-free number. The company X chose to provide a toll-free service. A customer of X chose to use it. Similar logic can be applied in the case of toll-free data also. There is no form of coercion anywhere.
3. The earlier article takes a reference of Norwegian interpretation of net neutrality and wants to use it in an Indian context. Going by this logic we should wonder whether the author(s) of the article is(are) prepared to pay rates proportionate to those in foreign markets, rather than what we have in India today.
4. We live in a world of disruptive innovation. Things can change in a very short period for established market players. Those ranting against the toll-free data service may need to think about this.
5. Coming back to the last part of point 1. I believe the customer is intelligent enough to make a distinction between good service and bad service. The critics of TFD have to realize that if I am not happy with X, whatever they may do I will want to shift to a different provider. And if I truly like Y for their services, I would want to bring pressure on them to provide me a free service like X!
6. Facebook Zero and Wikipedia Zero are similar concepts. We do not hear about them because these have not been hyped up. I for one have not seen posts criticizing Facebook or Wikipedia for driving traffic away from other websites! There is an article here, as pointed out by my former engineering batchmate, Abhishek Nalin.

So I believe there is over-reaction and media-hype over a non-issue, the proverbial making of a mountain out of a molehill. My basic points are simple.

1. Let us understand before we comment
2. Let us analyze with logic rather than emotion
3. Innovation will continue. Let us debate as much as required and then proceed. There always will and should be differing view points.