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Can Blockchain-Based Supply Chain In Agri Sector Help Farmers In India Realize More Gains

Can Blockchain-Based Supply Chain In Agri Sector Help Farmers In India Realize More Gains

Amal Nair

Blockchain has already established it’s firm roots in almost all major sectors, mainly across Finance, Trade and even Marketing. Another sector that is seeing an upsurge in adoption is agritech wherein industries are keen on using Blockchain.

Blockchain has become a very frequent term in the financial transaction space offering better security and reliable transaction. The Agri-Food industry in India plans to leverage this technology to improve the existing and legacy systems of supply-chain management, especially due to the growing concerns over food safety and the lack of reliability in the existing supply systems, based on a report.

The online retail or e-commerce is still relatively new to the Indian consumers with the majority of the services being provided only in cities, while a major part of the Indian population mainly rural still rely on physical stores to buy goods and groceries. Most of the existing Supply Chain Management systems are still based on the old paper transactions which are often subjected to corruption.

Are we ready For Blockchain?

Agriculture and food supply chains are in fact interlinked. Like all products, agricultural products are always inputs in some Distributed Supply Chain that involves many actors or players such as farmers, shipping companies, distributors, and groceries etc with customers being the final client. In such a system that involves multiple transactions and trade, a technology such as Blockchain can considerably make it more efficient.

In India, often the producers or farmers in the Agri-Food industry are affected by less marginal prices of the produce. With the infusion of Blockchain, the situation can change. Adopting Blockchain will cut out a large number of unnecessary or un-complimenting intermediaries that can reduce transaction costs, improve margins, and induce efficiency and eventually benefit the farmers or producers of the crops.

Blockchain can be a great tool for transparency. With each and every transaction stored on a shared ledger protected by cryptography, Blockchain ensures that all transactions are visible to all the players at the same time. Blockchain can be the perfect solution for scams, frauds, and inefficient paper-based transactions, which have plagued the supply chain sector in India for a long time.

But the real challenge in adopting Blockchain depends on the cost factor. Will the consumers be ready to pay a price for the sake of an efficient Supply chain management system. If the industry does raise the price, the more direct beneficiaries will be downstream actors such as producers and aggregators. Such issues can only be resolved at the regulatory and policy level.

A research report findings of a pilot study on the application of blockchain by agri-food industries presented a roadmap on the adoption of the blockchain. The report says that the producers can add value to their products due to increased transparency and attributes of product credence. Enhanced traceability of products ensures that the producers can access institutional credit and enter smart contract with processors and consumers and also they can realise a fair price due to less interference of traders or middlemen. Certification agencies, government organisations, retailers/traders, producers of digital equipment, knowledge institutions, agro-ICT companies and blockchain start-ups are other stakeholders in the blockchain ecosystem.

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Adopting Blockchain

The 2018 Food and Agriculture Organization’s (FAO) policy on Blockchain states that the technology is well capable of enabling an immutable contract between the various supply-chain actors and can instil transparency.

According to a recent report, a consortium of Indian food companies has tied up with tech giants to adopt blockchain for more transparent and reliable food supply-chains. The blockchain is capable of ensuring quality and can help businesses comply with regulatory standards.  The report hints that many grape-exporting businesses from western India have shown a keen interest in Blockchain technology to improve quality checks of containers and comply with sanitary and phytosanitary standards to realise export potential.


Blockchain as a recent technology has already proven to be quite successful in terms of security and reliability with wide acceptance across multiple sectors. With Blockchain ensuring an efficient Food-Supply Chain system in India, the farmers or producers who often end up with fewer margins can get benefited and also at the same time consumers can trust the products they buy without having to worry about scams or fakes.

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