Green Revolution & Agripreneurship

Green Revolution & Agripreneurship

Objective

1.Window Rural India “ The Big Bang ”

2.Rural India “ Power Booster ”

3.Agripreneurship “ Corporate Fission ”

4. Agin-Financing “Strategic Fusion”

5. Gravity “ The Conclusion ”

Monday, April 10, 2023

Gaurav Gyan Srivastava

Window Rural India “ The Big Bang ”

THE BIG BANG

Rural marketing facilitate flow of goods and service from rural producers to urban consumers at possible time with reasonable prices, and agriculture inputs/

consumer goods from urban to rural.



TYPES OF RURAL MARKETS:

HAATS /SANDIES (mostly for weekly market for all commodities) MANDIS (mostly for all types of grains ) COMMODITY SPECILISED MARKETS

Rural marketing is as old as the civilization. Surplus of agro - products are exchanged in earlier days in the barter system. The introduction of currency, transport, and communication has increased the scope of rural market. This paper discusses the present scenario of rural marketing, and its importance, current trends, and highlights certain problems related to rural marketing.

Further it highlights the improvements which make the rural marketing system most effective.

The difference between rural and urban markets on the basis of various socio – economic factors, most dominant among them being the source of income, the frequency of receipt of income, the seasonal nature of income

and consumption. Rural markets are small, non- contiguous settlement units of village relatively low infrastructure facilitates, low density of population,

their life styles is different.



TABLE: India’s Population in villages (Source: Census 2001)

Population No. of villages % of total villages

Less than 200 96,855 15.7

200-500 1,36,454 21.4

501-1000 1,56,737 24.6

1001-2000 1,40,751 22.0

2001-5000 87,206 13.7

5001-10,000 20,363 3.2

Total No. of villages 6,38,365 100.0

Gaurav Gyan SrivastavaMonday, April 10, 2023

According to this definition, there are 638,365 villages in the country as shown in table. Of these, only 3.2% have a population between 5000 and 10,000, and 13.7% have population between 2000 and 5,000 and another 15.7% less than 200. From

this data we can analyze the economics of cost involved in rural distribution coverage.

Leaving aside Hindustan lever and ITC, most FMCG and consumer durable companies, define any territory that has more than 20,000 and 50.000 population

respectively, as rural market. so, for them, it is not rural India which is rural. According to them, it is the class-2 and class-3 towns that are rural. According to the census of India 2001, there are more than 4,000 towns in the country. It has classified them into six categories –around 400 class-1 towns with one lakh and

above population (these are further classified into 35 metros and rest non-metros), 498 class-2 towns with 50,000-99,999 population, 1368 class-3 towns with 20,000-50,000 population and 12,560 class-4 towns with 10,000-19,999 population. It is mainly the class-2 and 3 towns that explains their enthusiasm about the so-called

“immense potential” of rural India.

There is so denying the fact that Indian market is fastest growing market in the world, with immense opportunities most of which exist at the top end comprising

about 300 million people. The fact is that about 60% of the market considered rural is yet to turn into a real market


Few Facts70 % of India's population lives in 627000 villages in rural areas. According to the NCAER study, there are

almost twice as many 'lower middle income' households in rural areas as in the urban areas.

At the highest income level there are 2.3 million urban households as against 1.6 million households in rural areas.

A middle and high-income household in rural India is expected to grow from 80 million to 111 million by 2007.

In urban India, the same is expected to grow from 46 million to 59 million. Thus, the absolute size of rural India is expected to be double that of urban India

OpportunityThe above figures are a clear indication that the rural markets offer the great potential to help the India Inc

which has reached the plateau of their business curve in urban India to bank upon the volume-driven growth.

The Indian rural market with its vast size and demand base offers a huge opportunity that MNCs cannot afford to ignore. With 128 million households, the rural population is nearly three times the urban.

As a result of the growing affluence, fuelled by good monsoons and the increase in agricultural output to 200 million tones from 176 million tones in 1991, rural India has a large consuming class with 41 per cent of

India's middle-class and 58 per cent of the total disposable income.

The importance of the rural market for some FMCG and durable marketers is underlined by the fact that the rural market accounts for close to 70 per cent of toilet-soap users and 38 per cent of all two-wheeler

purchased.

The rural market accounts for half the total market for TV sets, fans, pressure cookers, bicycles, washing soap, blades, tea, salt and toothpowder, What is more, the rural market for FMCG products is growing much faster

than the urban counterpart.


Rural India “ Power Booster ”


FEATURES OF INDIAN RURAL MARKETS:

Large and Scattered market:The rural market of India is large and scattered in the sense that it consists of over 63

crore consumers from 5,70,000 villages spread throughout the country.

Major income from agriculture:Nearly 60 % of the rural income is from agriculture. Hence rural prosperity is tied

with agricultural prosperity.

Low standard of living:The consumer in the village area do have a low standard of living because of low

literacy, low per capita income, social backwardness, low savings, etc.

Traditional Outlook:The rural consumer values old customs and tradition. They do not prefer changes.

Diverse socio-economic backwardness:Rural consumers have diverse socio-economic backwardness. This is different in

different parts of the country.

Infrastructure Facilities:The Infrastructure Facilities like roads, warehouses, communication system, financial

facilities are inadequate in rural areas. Hence physical distribution becomes costly due to inadequate Infrastructure facilities.


The rural bazaar is booming beyond everyone's expectation. This has been primarily attributed to a spurt in the purchasing capacity of farmers now enjoying an increasing marketable surplus of farm produce. In

addition, an estimated induction of Rs 140 billion in the rural sector through the government's rural development schemes in the Seventh Plan and about Rs 300 billion in the Eighth Plan is also believed to have significantly contributed to the rapid growth in demand. The high incomes combined with low cost of living in the villages have meant more money to spend. And with the market providing them options,

tastes are also changing.

Attractiveness of rural market:Large Population.Raising Prosperity.

Growth in Consumption.Life-cycle Changes.

Life-style Advantages.Market growth rates higher than urban.

Rural marketing is not expensive.Remoteness is no longer a problem


Rising Rural Prosperity:Rural India buys

46% of soft drinks sold49% of motor cycles

59% of cigarettes 18 million TV sets are in rural India

Of 2 million BSNL mobile connections, 50 % are in small towns/villages11% of rural women use lipstick

India is showing a dramatic shift towards prosperity in rural households the lowest income class (Rs. 25, 0000 & below) will shrink from more than 60% in 1994-95 to 20% in 2006-07. The higher income classes will more than

double.

Income groups 1994-95 2000-01 2006-07

Above Rs. 1,00,00 Rs. 77001-100000 Rs. 50,001-77,000 Rs. 25001-50,000 Rs. 25,000 & below

1.62.78.326

61.4

3.84.713

41.137.4

5.65.822.444.622.2


Projections based on 7.2 % GDP growth

Source: NCAER , Business World, 11 October 1999 P.-28

In another study 1997 NCAER came up with the projections of distribution of the households and people income-wise.

Rural market constitutes 71.4% of household in 2001-02. It decreases to 77.7% by 2006-07. It is a result of growing

urbanization.

Middle income segment constitutes the major chunk of the total market population wise in 2001-02 and 2006-07 being 85.5%

(88.38 cr. out of 102.95 cr. Of people) of the total market respectively.

Where is this large middle segment? In rural areas. About 70% of the people and households of the total market are in the rural

areas.


ZAX-14 Consumer durables: Rural Vs Urban:

Groups Areas Millions units1994-95 2001-02* 2006-07*

Growth % change over 2001-02

Previous period 2006-07

1 Urban

Rural

140.10 195.15 245.09

224.17 330.63 430.93

39.29

47.49

25.59

30.34

2 Urban

Rural

61.44 95.54 122.70

43.54 100.13 144.83

55.50

129.97

28.42

44.64

3 Urban

Rural

35.99 83.05 138.31

11.24 29.90 57.10

130.76

166.01

66.54

90.97


The durables are classified as under for analysis:

Group-1: Less than Rs.1000 in value. Items like transistors, pressure cooker, wrist watches & bicycles.

Group-2: Rs.1001-6000 in value. Items like B&W TVs, Mixers & vcd players.

Group-3: Rs.1001-6000 in value. Items like colour TVs, refrigerators, two wheelers and washing machines.

From the table it is obvious that:Rural markets for Group-1 durables are bigger than urban ones already

Rural markets for Group-2 durables will be bigger than urban ones by 2001-02Rural markets for Group-3 durables will remain smaller than urban ones even in

2006-07Rural market growth rates are faster than Urban ones in all the three groups.


CHALLENGES OF RURAL DEVELOPMENTPoor Infrastructure

Non-availability of shopsPoor literacy rate

Erratic power supplyPoor media penetrationRigid social customs

Regional politicsSkeptical customers


Agripreneurship “ Corporate Fission ”

Mango farmers in five blocks of Chittoor district of Andhra Pradesh have found a way out of the travail of handling the middlemen: they have signed up to sell their produce directly to

Coca Cola India, which is a bulk consumer of fruit pulp for its mango drink, Maaza.

Thanks to the ongoing retail boom, these kinds of supply-chain linkages are likely to be replicated all over the country, to the benefit of the poor farmers.

About 5,000 farmers owning about 95,000 acres (about 38,000 hectares) in the district formed a co-operative society to take a short-cut to secure remunerative prices for their

produce under the aegis of Federation of Farmers Associations (FFA).

“Over 3,000 tonnes of mango was supplied to Coca Cola in the 12 months since July 2006, when the scheme was operationalised,” said Vijay Kumar, project director, Mango

Value Chain Project, implemented under the aegis of FFA.

They have got trained by USAID- (US Agency for International Development) funded GMED (Growth-oriented Microenterprise Development project) in technology and advanced

agricultural practices for increasing productivity.



“About 600 farmers underwent a 15-day training in the Lucknow-based Central Institute of Sub-tropical Horticulture, a designated nodal agency for mangoes,” said Vinay Tuli,

project manager, GMED, Jaipur. These include those from Thane district of Maharashtra and Nausari district of Gujarat.

GMED experience also helped FFA in establishing linkages with farm suppliers for fertilizers, pesticides and seeds, enabling farmers to access inputs at cheaper rates

directly from manufacturers. Price-wise too it proved beneficial to farmers – the top average price of mangoes in the nearby mandis on the day will be paid to the farmers,

insuring against fluctuations.

Other advantages include electronic weighing (saves 60 kg out of a tonne), transportation borne by the company (5-6 per cent of the price), saving in mandi

commission (5 per cent), early payment (in 3 days against one month of sale) – amounts to over 15 per cent all put together.

Coca Cola requires 80,000-90,000 tonnes of mango pulp per annum. Of its total requirement, 80 per cent constitutes the Totapuri variety produced in Chittoor district,

while Alphonso mangoes from Maharashtra constitute the remaining.

The thrust of GMED is to train 100 people in each area, the success of whom will lead to the replication of practices in the nearby areas.



In My Words

“Agripreneurship is a strategy through which a growing economy & developed economy motivate third party to take initiatives to receive advantage & pull the

development to achieve desired objective in terms of rural socio-economic development within a specific time period”.

In other words we can say that

“ Agripreneurship is integration of agriculture involved entrepreneurship over specific time period to get desired socio-economic revolution with the help

third beneficiary entity.



Agin-Financing “Strategic Fusion”

Old Bataiya System or Banking Lease System1.As we know banks are having good links with corporate sector and if

they(banks) collect data base about their (corporate Sector) requirements & then formulate a centralize block where they collect data (Data

Warehousing for Agri-Business) regarding the requirement and establish network in between producer and user then they (banks) earn good profit and create market for the poor producer and save them (poor producer)

from third party involvement.

2. Bank can identify land and go for soil check after getting permission from government take theses land on lease hire poor farmers as worker give them good training & remuneration and after getting produce sell them

on reasonable price to the big business sharks to get profit.



Company -A

Company -B

Company -C

Producer Product -B

Bank-Z

Producer product-A

Producer product-C







CONCLUSION

To be successful in the Agripreneurship & rural development it is essential for the government to take corrective steps for the better marketing of rural

prospective & give motivation to the companies so that they will take innovative and sensitive steps while devising business strategies.

Companies should not fight for the limited rural share but join hands with the government to expand the rural market as a whole by means of creating

economic activity in the villages, through micro-enterprises and utilize these efforts to link them with large industry. these public-private partnerships will

go a long way in generating the much needed purchasing power in the villages and will thus lead to higher demand of corporate product.

“Top line and bottom line growth should not be the objective of getting into rural markets. For as of now, all these markets offer a future opportunity.

One can’t really make fortunes out of these markets as yet. It is an investment being made, both interns of efforts and capital, which would take a long time before it yields fruitful results. Rural development & Agripreneurship, as of

now, is all about seeding the Agriculture-entrepreneurship, creating awareness about facilities to motivate to promote a culture for

Agripreneurship”


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Green Revolution & Agripreneurship