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Mobiles offer 'a glimmer of hope' to farmers

06 November 2009

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Mobile phones along with the mobile-enabled services are contributing significantly in empowering farmers in India, writes Gaurav Tripathi, researcher at ICRIER. According to a new study, mobiles are aiding small farmers by reducing the information gap, lowering transaction costs and augmenting their earnings.

While substantial anecdotal evidence on the impact of mobile phones on farmers has been reported in the media, rigorous demonstration of its potential has only recently been attempted.

Image credits: Google/ In rural villages, farmers use cell phones to find the latest market price on products

Among the most celebrated of such studies is the Jensen (2007) paper that estimated the welfare impact of introduction of mobile phones among the fishing community in some of the districts in Kerala.

The study concluded that the economic impact of mobile is likely to be strongest when the absence or inadequacy of existing telecommunications facilities acts as a barrier or bottleneck to private economic activities, but also when enough, other infrastructure exists to permit the effective use of telecommunications.

Bridging the information gap

An ICRIER study on the impact of mobile phones on farmers across several Indian districts highlights the key role played by mobiles in lowering transaction costs and raising the income-levels of farmers, by efficiently addressing their immediate agricultural-information requirements.

Information asymmetries are a well documented source for inefficient functioning of markets; farmers can bridge or alleviate the information gap at three major stages of the agricultural cultivation cycle by the use of mobile phones.

One, while deciding the crop and choosing the best seed variety based on soil-type of their land; two, deciding the month/season of sowing and addressing plant protection issues during the growth of crop; and three, deciding where and at what price to sell the farm output.

Mobile phones enable farmers to access this information from a host of information providers such as scientists from seed and pesticide companies, cooperative committee office-bearers, input dealers, government agriculture extension officers, market-commission agents/traders, veterinary doctors, and so on.

If such information is available when the farmers need it, not only does it reduce transaction costs, it also improves the returns farmers can get for their produce. In the discussions with farmers, they emphasised that timing of precise information is central to minimising wastage and therefore increasing efficiency.

Boosting agricultural systems

The recent launch of mobile-based agricultural information services in India, such as IFFCO Kisan Sanchar Ltd and Reuters Market Light programme provided a reasonable method to test the above hypotheses. UP, Rajasthan and Maharashtra, with sizeable subscriber-base, were surveyed during July and November 2008.

In general, farmers were confident of the utility of the mobile phone in reducing costs and enhancing earnings. The biggest influence was reported from Maharashtra followed by Rajasthan and UP.

Maharashtra farmers took greater advantage of the mobile phone for their farming needs vis-a-vis farmers in UP and Rajasthan. It should be highlighted that in our sample the Maharashtra farmers were better placed in terms of both social and infrastructure indicators.

They reported higher literacy levels, economic well-being, and had better access to agricultural infrastructure facilities like irrigation and road transport, than the other two states.

The study highlights the vital importance of complementary skills and other infrastructure to realise the full potential of better access to telecommunications. There is no benefit in access to better information if it cannot be leveraged.

For example, there is no use of farmers knowing the prices that their produce could be sold for in different markets if the roads are too poor for them to be able to transport the goods to those other markets.

At a time when the government agricultural extension services are unable to adequately fulfil their responsibility of providing information on scientific modern technology for farming to all the farmers due to resource constraints and the operative inefficiencies, mobile phones along with the mobile-enabled services present us with a ray of hope for uplifting our agricultural extension system.

Hope for farmers during crisis

Mobile phone has the potential to effectively supplement the efforts of existing extension services and synergise the whole process. The fast growth of mobile penetration and the rapid expansion in mobile communication network by the telecom players provide a fertile ground for looking at this medium seriously.

We found during our survey that mobile phone has huge potential to enable the small farmer to diversify from self-sustenance farming to higher income generating ventures like horticulture crops, animal husbandry and fish farming in paddy fields.

This is particularly useful when returns to farmers are decreasing due to decline in agricultural yields and shortage of fertilisers for the past few years, putting pressure on them.

Mobile phones have the potential to play a key role in efficient logistics management and reduce costs for both farmers and the government.

In the grim situation faced by farmers in several districts of India today due to scarcity of rainfall, the mobile platform offers a glimmer of hope; the government will be well advised to support the development of the complementary infrastructure to enable farmers to maximise the benefits that go with better access to information.

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