Farmers tune in to online auctions
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Kolkata: A unique e-auction project is likely to open the plantations of India’s north-eastern states to the world. A simple process of online registration and participation of bidders across India and the world is being offered as a solution to the logistical problems of distance to wider markets, remoteness and lack of infrastructure that have hamstrung the development of the agricultural sector of the eight north-eastern states, including Sikkim.
Developed by the Centre for Development of Advanced Computing C-DAC, Kolkata, after being approached by the North Eastern Regional Agricultural Marketing Corp. Ltd (Neramac), a government of India enterprise under the ministry of development of north eastern region, the online e-auction system of farm products has tasted initial success with Sikkim’s large cardamom produce.
Arunachal Pradesh and Nagaland are expected to join the e-auctioning system from August-September this year. The remaining states will come on board in phases.
Under the system known as the Centralized e-Auction System for North Eastern States, buyers are expected to call out bids on the agricultural products. The products are placed in lots and are showcased online to prospective bidders before the actual auction takes place on the website, eauction-neramac.in, that can be accessed through any computer with an Internet connection. While farmers have to pay Rs.2,000 for registering on the site, traders pay Rs.15,000, with the registration being valid for two years.
The Centralized e-Auction System for North Eastern States was the finalist in the business and financial inclusion category, at the Manthan Awards.
The e-platform is based only on bulk sales, with a minimum order of 25kg, going up to 4 quintals. Once a bid is sealed, the farmer has to pay 1% while the auction winner pays 2% of the sale amount to Neramac. “This has been done to ensure self-sustainability of the model,” says Goutam K. Saha of C-DAC.
The digital advantage
Sikkim, with about 500 farmers registered on the e-auction platform, was the first state to go online in November 2015. Having recently been declared India’s first fully-certified organic farming state, Sikkim’s famous black cardamom reached a peak price of Rs.1,800/kg, a steep hike from Rs.1,200/kg it was selling for earlier, informs Saha.
“What the e-auction platform can do is to prevent trade cartels from forming, avoid middlemen and ensure higher prices for the farmers. It also opens up the market for the farmers of the North-East,” he adds.
Indeed, bidders from places as distant as Sri Lanka and Saudi Arabia vied for the black cardamom of Sikkim, a landlocked Himalayan state dogged by logistical and infrastructural problems.
When fully operational, the e-auction project hopes to involve 170,000 farmers from the states of Assam, Meghalaya, Arunachal Pradesh, Manipur, Mizoram, Nagaland, Tripura, besides Sikkim. Neramac aims to auction farm produce from these states like large cardamom, pineapple, ginger, turmeric, kiwi and passion fruits when all the states come into the e-auction fold. In the case of easily perishable commodities like kiwi fruit, proper packaging facilities are also provided.
“While items like ginger and large cardamom don’t easily perish, for perishable items the days of auction are also less. The software provides shipping assistance to buyers and gives information on local courier services, while Neramac helps in actual shipping. Packaging quality has improved tremendously these days and that is the reason you can buy apples from China sitting here in Kolkata,” says Saha.
Agriculture has been the traditional economic backbone of most north-eastern states, where the industrial investment climate is yet to pick up. The market has so long been contained within the district and states of origin. Being vastly removed geographically from the mainland Indian market, and prone to problems of insurgency and political instability, a produce as scrumptious as pineapples from Nagaland and Manipur, or oranges from Sikkim, finds it difficult to reach the table of consumers in the rest of India.
An innovative model like the Centralized e-Auction System for North Eastern States aims to ensure that the agricultural economy in the eight states can come to fruition soon.
Mint has a strategic partnership with Digital Empowerment Foundation, which hosts the Manthan and mBillionth awards.