} Introduction
e-Choupal
is an India-based business initiative by ITC Limited that provides Internet
access to rural farmers. The purpose is to inform and empower them and, as a
result, to improve the quality of agricultural goods and the quality of life
for farmers.
>> By
Whom?
[1]ITC
Limited (formerly India Tobacco Company Limited) is a consumer product and
agribusiness conglomerate in India known for their production of cigarettes,
specialty paper, food products and packaging services.
How?
1Through
the e-Choupal initiative, ITC has created more than 6,500 e-Choupal computer
stations in rural areas that serve an average of six hundred farmers each.
Using this technology, farmers may order supplies, learn about best
agricultural practices, receive weather reports and read about pricing for
crops throughout the region.
Farmers can
use that information to their own prices. They also obtain higher profit
margins because they’re no longer forced to sell through a middleman. ITC
Limited also benefits from the initiative, by simplifying its supply chains and
increasing its profits.
>> Reach:
[2]ITC
has brought a network of insurance companies, banks, micro-finance entities,
seed and fertilizer companies, FMCG, e-learning and training organisations to
the doorstep of rural India. Launched in June 2000, e-Choupal is the largest
initiative among all internet-based interventions in rural India.
Its services
reach out to over 3.5 million farmers growing a range of crops — soyabean,
coffee, wheat, rice, pulses, shrimp through 5,200 kiosks across ten states.
These
interventions have helped transform village communities into vibrant economic
organisations, by enhancing incomes and co-creating markets. ITC’s e-Choupals
serve 40,000 villages and 4 million farmers, making it the world’s largest
rural digital infrastructure created by a private enterprise.
e-Choupal
|
No
|
States
covered
|
10
|
Villages
covered
|
40,000
|
No. of
e-Choupals
|
6,500
|
Farmers
empowered
|
4 million
|
>> Financial
impact on ITC’s business
Chief
executive (agri-businesses), ITC, S. Sivakumar, says it will be difficult to
quantify the profit implication e-Choupal has on the FMCG business, he reckons
it will be significant.
The
network has also become a big rural sales and distribution channel for ITC. The
company has started to sell its FMCG products in rural India through e-Choupal.
Of
ITC's agri-business division revenues of Rs 5,695 crore in 2011-12, internal
sales for supplying commodities to the FMCG business stood at Rs 2,282 crore as
per the latest annual report. ITC says the non-cigarette FMCG business is
growing at a compounded annual rate of 40% since 2005-06.[3]
>> E-Choupal
in the vision of ITC (FY 2010)
ITC
targeted a huge revenue from e-choupal . A report from The Economic Times (Jul 7, 2006)[4] says“ITC hopes the business to
generate revenues of $2.5 billion -- almost equivalent to the current size of
the company -- by 2010”.
The project was initiated with
the objective of achieving a win-win situation for both farmers and the
company. So on the one hand more profits and larger share of commodity exports
were ensured for the company and on the other hand farmers realized better
prices for their produce and improved the productivity of their farms.
Initial goals were following
Helps
enhance farm productivity by
• Disseminating latest information on district
level weather forecasts for short & medium terms
• Best practices in farming (generic as well as
specific)
• Supply of quality inputs (seed, herbicide,
fertilizer, pesticides etc) in the village itself
Helps
improve price realization for farm produce by
• Making available live data on markets viz.
Location / Buyer wise prices offered
• International market prices of relevant
agri-commodities
• Historical & Up-to-date information on supply
& demand
• Expert opinion on expected future price movements
'e-Choupal' also
unshackles the potential of Indian farmer who has been trapped in a vicious
cycle of low risk taking ability > low investment > low productivity >
weak market orientation > low value addition > low margin > low risk
taking ability. This made him and Indian agribusiness sector globally
uncompetitive, despite rich & abundant natural resources.
A business concept
embedded with social goals, e-Choupal was designed to empower farmers and
triggers a virtuous cycle of higher productivity, higher incomes, enlarged
capacity for farmer risk management, and thereby larger investments to enable
higher quality and productivity.
>> Critical
Success Factors
ž Comprehensive knowledge of rural market.
ž Designing a win win transaction model.
ž Leveraging the logistics channels.
ž Selection of sanchalak.
ž Evolving an appropriate user interface.
ž Bottom up model for entrepreneurship.
>> Conclusion
e-Choupal has been most
successful initiative to wire rural India and to involve the farmers in
learning. ITC has envisaged on various plans to replicate the success achieved
to other states and expand the services offered to other commodities like
spices. ITC has also identified e- Choupal as an important driver for exports
Sources (Web links):
http://searchcio.techtarget.in/definition/e-Choupal
http://articles.economictimes.indiatimes.com/2006-07-07/news/27456505_1_e-choupal-choupal-sagar-agri-business-division
http://articles.economictimes.indiatimes.com/2012-07-25/news/32848625_1_fmcg-business-e-choupal-network-fiama-di-wills
http://articles.economictimes.indiatimes.com/2006-07-07/news/27463944_1_e-choupal-choupal-saagars-itc-eyes
http://www.planningcommission.gov.in/reports/sereport/ser/stdy_ict/4_e-choupal%20.pdf
http://www.itcportal.com/businesses/agri-business/e-choupal.aspx
http://www.itcportal.com/sustainability/embedding-sustainability-in-business.aspx