Socio-Economic Impact of Mobile Phones on Indian Agriculture

This paper looks at the impact of mobile phones on the crop sector and, in particular, on small farmers in India. The key finding of this research is that mobile phones can act as a catalyst to rejuvenate the extension services in the country.

Specifically, from the Abstract, "this paper investigates a series of questions that explore this topic: What kind of information do farmers value the most to improve agricultural productivity? Do mobile phones and mobile-enabled agricultural services have an impact on agriculture? What are the factors that impede the realisation of the full productivity enhancing potential of mobile phones? The answers to these questions have important implications for mobile operators, for information service providers, and for policymakers. The quality of information, its timeliness and trustworthiness are the three important features that have to be ensured to enable farmers to use it effectively to improve productivity.

The study found evidence that mobiles are being used in ways which contribute to productivity enhancement. However, to leverage the full potential of information dissemination enabled by mobile telephony will require significant improvements in supporting infrastructure and capacity building amongst farmers to enable them to use the information they access effectively."

Information asymmetry is reported here to act as one of the major constraints on the growth of agricultural productivity in India. The more rapid growth of mobile telephony as compared to fixed-line telephony and the recent introduction of mobile-enabled information services provide a means to overcome existing information asymmetry. Mobile information access also helps, at least partially, to bridge the gap between the availability and delivery of agricultural inputs and agriculture infrastructure. Uses of mobile phones by sector include the following:

• For farmers, seed-related information is the most frequently accessed information, followed by the mandi (market) price, plant protection, and fertiliser application, as well as seed variety selection, best cultivation practices, protection from weather-related damage, plant disease remedies, and price realisation. Infrastructure limitations and inability to purchase critical resources prevented farmers from realising the full benefits of mobile telephony; these include lack of irrigation and storage and poor roads.
  
• For fisherman, increased information resulted in larger catches and the prevention of losses through access to weather and optimal fishing zone information. Researchers did not find evidence that fisherman used mobile access for market arbitrage or maximising price realisation. The value of the mobile as an information platform was enhanced because it could be used as a means to communicate newly accessed information to others and allowed even those who did not have access to the "fisher friend" information service to share in the benefits. Lack of global position systems (GPS) inhibited use of location information, while lack of land-based infrastructure, including roads to market and cold storage, was also inhibiting.
  
• For traders and commission agents, market efficiency was improved by mobile access. "The heart of the business is centred around controlling the flow of supply and demand as much as possible to ensure they have product to sell and can optimise the daily price." Traders and agents reported that mobile phones were a critical infrastructure in their business. The call volume per person ranged from 10-30 calls per day. In addition to brokering, calls might involve dealing with truck breakdowns, shifting crops en route according to the supply and demand situation, and communicating instructions to staff - both locally and at significant distances. Traders also serve an advisory role in some areas, "serving as advisors and intermediaries via the mobile phone between farmers and numerous sources of information for information on crop choice, disease control, inputs (seed, fertiliser, pesticide) and matters of credit."

The research details how customised content enables farmers to avert losses, improve yields, and increase information relating to various agricultural practices. Mobility is a distinct benefit of mobile phones over other forms of information availability. For those in each sector, making calls and getting information rapidly enables them to access information while working (in real time) and wherever their work takes them. The convenience and time and travel saving were noted as advantages. Internet kiosks are available in some villages, but seem to serve a different purpose. Their use, as compared to mobile use, is focused on research, while mobile phones are used for trading, asking questions, deriving weather and very specific crop information, and for passing formation to social and business networks.

The Indian Tobacco Company Limited (ITC), through ITC Echoupal, has been piloting a new virtual commodity exchange, "Tradersnet", that enables direct buying and selling of coffee by producers and wholesale purchasers through an internet-based trading platform. Short message service (SMS) messages are sent to users’ mobile phones every morning with the offers and grades available for purchase on that day. ITC is also considering whether and how mobile phones can extend its rural information and communication technology (ICT) kiosk programme by inputting farmer information via mobile phone and delivering highly customised information to each farmer.

Lessons include the following:

1. "The customers are not fully informed about the existing services and various facilities under these services. Creating awareness among farmers regarding the range of services provided may help the service providers to increase their subscribers base.
   
2. Greater customisation and frequent updating add substantial value. Generic information triggers dissatisfaction and reduces the frequency with which farmers access the service. The most frequent criticism heard was that information was 'old and routine'.
   
3. Text messaging offers significant advantage over voice-based delivery in terms of convenience and content flexibility. Wherever literacy is a concern voice SMS can also be used.
   
4. Information should be in the local language and easy to understand. Most of the farmers we interviewed were prepared to pay for information services as long as they felt that they would get the information they wanted in a timely and reliable manner."