India-Philippines agriculture partnership

By Shambhu Kumaran, the Ambassador of India to the Philippines

As we strive to build a people-centered partnership between India and the Philippines, the agriculture sector is naturally a key focus area. A major lesson from the pandemic is that the agriculture sector, in addition to health and digital economy, will continue to play a crucial role in determining social and economic outcomes.

India is already a strong partner for the Philippines in health and IT. In the agriculture sector too, India can be a partner of choice. India’s rich experience can support the Philippines in its ongoing efforts to transform this sector, which accounts for over 10 percent of GDP and employs over 22 percent of the work force locally.

The problems confronting agriculture in developing countries are well-known. Issues of low productivity, difficulty of accessing credit, effective crop insurance, promoting mechanization, cutting post-harvest losses, building robust farm to market linkages, addressing the impact of climate change, etc. have all been studied for several years. Several recommendations on addressing them have been tried. Yet timely, appropriate and cost-effective solutions continue to evade us.

Indians take justifiable pride in India’s agricultural performance over the recent past. As late as the 1960s and even into the 1970s, India was dependent on food imports. Today, India is one of the world’s largest food-grain producers; in addition to feeding 1.3 billion people, we share a surplus for export markets.

This transformational change was possible due to the efforts of a range of actors and institutions, the effective interplay of policies and programs and above all the hard work of Indian farmers. Some of you may be aware of bold changes made to Indian farm laws recently. Any sector needs continued reform to thrive. The proposed legal changes are designed to ensure that India’s agricultural productivity keeps pace with the needs of tomorrow.

India is keen to support efforts of developing nations such as the Philippines in effecting similar transformations in agriculture. Indeed, India’s experience of transforming this sector dominated by small and marginal farmers, as well as fragmented agri-markets, provides an excellent model for the Philippines.

Addressing the general meeting of the Philippine Chamber of Agriculture and Food (PCAFI) last Friday, thanks to the kind invitation of president Danilo Fausto, I flagged five specific facets of India’s agriculture experience that could be useful for the Philippines.

Firstly, a renewed emphasis on production. Past efforts to support the agriculture sector, especially by companies, focused mostly on the front end, emphasizing the business to consumer engagement. Investments moved along similar lines, such as towards e-commerce. However, the pandemic has brought a renewed emphasis on resilience and reliability of agricultural supply chains and issues of food safety. This requires a new set of policies as well as R&D and investment that focuses on production.

A second and crucial aspect is technology. In India, we firmly believe digital technology is a multiplier and enabler for agriculture. Under Prime Minister Narendra Modi’s Digital India initiative, there is a massive effort to leverage technology to improve our agricultural sector.

Both established companies and start-ups are increasingly focusing on the use of technology, especially digital tools, to address the entire spectrum of the agricultural value chain. For instance, using geo-informatics, agritech startups are revolutionizing in the way which you can address crop, water and nutrient stress and even advise on marketing.

The objective is to develop a generation of smart farmers using geospatial data, personalized farm histories, etc. to move easily in the digital world. Like in the Philippines, Indian farmers are not entirely well equipped with fancy technology or even smart phones. Therefore, apps have been built around basic mobile telephones to deliver technological innovations to the farmer.

From about 40 startups in the agricultural sector in 2013, last year witnessed 1,000 agri-startups in India. Many of them have raised significant funding. Their business models range from margin, transaction or subscription based, thereby ensuring viability.

This is an area where we can easily share our experiences. PCAFI readily agreed to my proposal for a workshop for structured engagement between agritech start-ups from both countries.

The third aspect is financing. For long the benefits of a vibrant financial sector eluded Indian farmers. This is changing rapidly. Like the Philippines, India has many small marginalized farmers who have difficulty accessing credit. Under the newly established bilateral financial dialogue, we had identified fintech as one of three focus areas. Evidently, agriculture-oriented fintech will be in sharp focus.

Under Philippines’ Agri Agra law, agriculture is designated as a priority sector for lending. Working together, we can identify tools effectively used in India that will enable the local financial sector to provide better targeted, better performing loans to farmers and improved financing across the agriculture value chain.

Fourth, agriculture has to meet the needs of the future and especially climate change. The emphasis on ecologically sensitive farming, integrated farming as well as commitments to food safety requirements or demand for organic foods are all important. Consumers are becoming increasingly sensitive of what is on their plate. Producers must respond.

Lastly, let us not lose optimism about the future of our agriculture. One fact that stands out in the midst of the pandemic and a horde of recent natural disasters is the resilience of our farmers. They manage to stay optimistic even in the most difficult times. We have to nurture that spirit. With necessary policy support, adoption of best-in-class practices and leveraging new technologies, we can work together to ensure that the agriculture sector will continue to produce the sustainable growth required for our two economies well into the future.