Typically, the word ‘corporate’ implies a behemoth structure that has more power, capabilities and a larger presence in the world. Almost all these characteristics apply when you associate ‘corporate’ with farming as well.
Corporate farming has been around for quite a while now and has taken on a role in not just agriculture but allied fields as well. It is about large scale agriculture and the ability of a company to also play a part in:
- Agricultural supply management
- Influence government policy
- Fund research projects
- Establishing exports and imports relationships and so on.
Why does it exist?
Small farm holdings are, at times, unable to keep up with demand. Sometimes, it is also a case where the next generation of a farmer’s family does not really want to get into this business. Decreasing size of land holdings affects agricultural productivity.
Currently, 58% of India’s population relies on agriculture as a main source of income. For the period of April 2020 to January 2021, India’s principal agricultural commodities export was US$ 32.12 billion. In almost every sector related to agriculture, India ranks among the top countries.
Despite all the progress and achievements, agriculture’s contribution to GDP has been declining steadily. And our country can do better in terms of nutrition, increasing sustainability and management of agricultural practices.
While corporate farming may not always have all the answers and solutions, it is a movement that is changing a lot of factors in the Indian agricultural scenario.
Corporates bring change
Yes, there is a lot of debate around the merits and demerits of corporate farming. Here are some factors to consider:
Increasing investment in agriculture
India is still heavily dependent on monsoon for agricultural output. This also leads to a farmer being at the mercy of market fluctuations when it comes to livelihood. With a corporate entity in play, there could be better allocation of resources and a better way of managing the monsoon’s vagaries.
Information & technology
Technology is sophisticated and expensive. But it also has the power to change a farm’s fortunes. Take for instance, the employees of Wipro coming together to digitise the supply chain for dairy farmers and helping them manage 11 million litres of milk every day.
Better links to the markets
Corporates can put together a more efficient supply chain, quicker and stronger link to the market in a shorter time frame. This takes the burden of post-harvest management away from the farmer. It results in a greater portion of the consumer rupee being transferred to the farmer.
At the end of it all, it is also true that there is no ‘one size fits all’ solution when it comes to corporate farming. Job security, food security and the degree of control that a big company may exercise on a farmer are some of the important factors to consider. If the end goal is to increase productivity - would a solution like consolidation of land holdings work better than corporate farming. In which case, would contract farming also help?
These are issues that need to be examined very carefully before embarking on permitting a corporation to get into farming.