Sowing Prosperity: Boosting agricultural
Ankita Dey, Bhawana Goel, Suhani Gupta, Pankhuri Jain,
An Agri-Business Model to boost agricultural productivity
and to secure future of farming in India
1. India accounts for only 2.4% of world’s
geographical area and 4% of its water
resources but has to support about 17% of
the world’s population and 15% of the
2. Agriculture is an important sector of Indian
economy, accounting for 14% of nation’s GDP,
about 11% of its exports.
3. About half of our population still relies on
agriculture as its principal source of income
and it is a source of raw material for large
number of industries.
4. As per Agriculture Census 2010-11, small and
marginal holdings of less than 2 hectare
account for 85 percent of the total
operational holdings and 44 percent of the
total operated area
Boosting Agriculture Productivity by acquiring small
lands on rent by investors for particular crop season
Farmers lease their land to investors, in return they share profit
• Corporate houses invest in 1000 acres of land of farmers owing small
• Provide farmers with agricultural benefits
Management is subdivided into four sections- bank, research, FRO,
• Increase productivity by using bio-fertilizers, drip irrigation method,
agricultural machines like cane harvester, fanning, grain cleaner
Plan design, financial support , R&D support integral part of the model
• Negotiating for a good deal with the buyer
Influential with economic prices(1 crore per year)
• Pooling of small land holdings to increase productivity per unit area
• Farmers get assured returns from their land
Requirements • Farmers
• Long work
with banks in
• PhD scholars
Functions • assimilation
• Put forward
• Help in
• Provide data
• To get the
best deal of
5 allotted in
5 shall interact
5 for Research and
5 shall interact
5 will handle
5 for food storage
5 for procurement
of raw materials
Farmers processing organization(FPO)
It is a group of farmers interested in leasing their small lands to investors. It increases
their bargaining capacity, uniformity in produce and decrease in transaction cost.
Farmers choose a leader among themselves, who represents FPO to investor
• Choosing that part of country i.e. village where we find small fragmented lands
which can be collectively used as a large land
• Villagers prefer “share of produce” over money
• As irrigation is a problem in large land holding, drip irrigation is used
• In Drip irrigation, each and every drop of water is provided to plants so that there
is no chance of wastage and thus optimum utilization of water
• Watershed development Technique is also commonly used where rain water is
stored in a large reservoir for future consumption
• During adverse conditions- oilseeds, fibres, fruits can be grown which do not
• India is the forth largest producer of oilseeds, thus it will help us to generate
• Being exporter, we have a fair chance to maximize our profits
Step 1: discuss mapping of land with FPO and farmer’s share of return
Step 2: allocation of funds to all departments and procurement of raw materials as well as
machinery. Custom hiring of agricultural goods is also feasible
Step 3: supply chain management looks after the delivery of agriculture inputs from input
suppliers to the agricultural site
Step 4 : Laborers recruited from the village thereby increasing employment in village and
work according to our strategy under the guidance of management system
Step 5 : Harvesting of crops through machinery and then dry them, grade them, pack
them using bar code so that it can be easily traced.
Step 6 : Logistics department will handle the transport of Packaged goods to warehouses
Step 7 : interaction with agro processers and retailers and they will issue a tender notice
for their produce and they will keep updating interested dealers about increasing our yield
Step 8 : R&D will survey the land, 1 month before the end of crop season, analyze the soil
properties and recommend the suitable crop that can be grown in the next season
Step 9 : setting up of training camps to make farmers aware of new farming techniques,
computerization and cost effective technologies that are used in farms.
This will benefit us in building a positive relationship with farmers in bringing
transparency in work
• Production risk: natural calamities, pests and disease outbreaks, bush fire are
major risks that lead to production volatility
• Market risk: risks like commodity and input price volatility, exchange rate and
interest rate volatility usually materialize at the market level
• Environment enabled risk: change in government or business regulation, political
risks, conflict, trade restrictions which lead to financial losses
Risk management strategies:
• Mitigation: Activities that reduce the likelihood of an adverse event or reduce the
severity of actual losses.
• Transfer: Transfer of risk to a willing party for a fee or premium. Commercial
insurance is a well known form of risk transfer.
• Coping: Improving the resilience to withstand and cope with events. Example
include social safety net programs, savings and strategic results.
A risk layering approach, based on the probability of occurrence and potential losses,
is used to select an appropriate
• 1000 acres of small and defragmented village land to be used.
• Hundreds of small land owing farmers will be benefitted.
• 35 members management system will work on increasing the per hectare
productivity of these lands.
• Value added:
• Many laborers will get employment in rural areas.
• Save large wastage.
• Keep quality of produce fresh, thereby helping farmers in fetching better prices.
• Contract will be renewed after very crop season so that owners of these lands
proper time to rethink upon.
• R&D team will suggest the about high-yielding seeds, fertilizers, machineries to be
used to increase the per hectare productivity of these lands.
• Owners of these lands will get acquainted to new farming techniques.
• Storage and transaction cost per farmer will get reduced.
• Employees Salary = 5*4 + 5*9 + 5*10 + 5*15 + 5*15 + 5*20 + 5*30 = Rs. 5,15,000
• So total Employees salary = 515000 * 12 = Rs. 61, 80,000 (or Rs. 61.8 lac)
• R&D cost expenditure= Rs. 15,000 per year
• Cost to Labourers (40 in numbers) = Rs. 18,000*40= Rs. 7.2lac per year
• Fertilizer expenditure= 63.2kg/acre * Rs. 10/kg= Rs. 632/acre
• Estimated cost(1000acres)= 6.32lac
• Machinery expenditure= 27.9lac ($46,500 US)=27.9*3= 83.7lac
• Total =83.7lac+ 6.32L=90.02lac
• Agriculture loan=90.02L
• State of Indian Agriculture 2012-13
• Gulati, A. & Jain, S. (2012, December 20). Credit inclusion, farm lease and forming
clusters can help small farmers overcome poverty much faster. The Economic
Times. Retrieved from
• World Bank. (2012). India: Issues and Priorities for Agriculture. Retrieved from
• Agricultural Census, Government of India. (2012). All India Report on Agricultural
Census 2005-06. Retrieved from
• Agriculture & Climate Change by Dhurjati Mukherjee from Kurukshetra (June 2012)
• Law of the People's Republic of China on Land Contract in Rural Areas (Order of
the President No.73)