Blockchain technology can aid in increasing farm income. Discuss.
Published: March 15, 2018
The blockchain is a distributed ledger technology that allows all members to record transactions in a decentralised data log maintained on a network of computers, rather than a physical ledger or a single database. Transactions must be approved through consensus, and everything is secured through cryptography.
Blockchain technology is widely used for cryptocurrencies. Blockchain technology can revolutionise agriculture by some of the following means and ways:
Consumers have grown suspicious of the food they are consuming. Food allergies are increasing. Food processing industries can use blockchain for ensuring accountability, traceability and quality of the food. This can also aid in increasing the food exports from India. This will give boost to agricultural sector and will aid in attracting investments.
Efficient food chain management
Food supply chain in India is inefficient due to information asymmetry. It is adversely affecting the farmers income. Blockchain technology can make this food chain transparent and aid in cost benefits for both farmers and consumers by attacking the cartelization.
Farmers are often unaware of the authenticity of the farm inputs like fertilizers, seeds etc. Blockchain can bring information symmetry with respect to quality of farm inputs. Assured quality inputs aids in increasing productivity.
Recoding keeping practices are very poor in India and this is often resulting in litigations. Blockchain technology for record keeping will enhance transparency. This will aid in investments in agriculture.
Increased consciousness about health has resulted in increased demand for organic products. But tracking the authenticity of the organic products is a cumbersome process. Blockchain technology can aid in better quality management with organic farming.
Targeting of Subsidies
Government allocates more than Rs. 30000 cr for farm subsidies. But often is falls victim of leakage and corruption. Blockchain technology for subsidy management will aid in eliminating corruption and leakages.
Blockchain technology is disruptive technology. It can lead to innovations which can enhance the productivity leading to increased income for farmers.
Model Questions Category: 067 - E Technology in the Aid of Farmers