e-Choupal is an initiative of ITC Limited, a conglomerate in India, to link directly with rural farmers via the Internet for procurement of agricultural and aquaculture products like soybeans, wheat, coffee, and prawns. e-Choupal tackles the challenges posed by Indian agriculture, characterized by fragmented farms, weak infrastructure and the involvement of intermediaries. The programme installs computers with Internet access in rural areas of India to offer farmers up-to-date marketing and agricultural information.

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The ITC chose to operate the platform on the following three business principles:

(i) Free information and knowledge which ensures wider participation by the farmers.

(ii) Freedom of choice in transactions (farmers after accessing information at the e-Choupal, are free to transact their own way.)

(iii) Transaction based income, stream for the Sanchalak by tying his revenue stream to the transaction (on a commission basis.)

Implications of e-Choupal:

• ITC Limited has provided computers and Internet access in rural areas across several agricultural regions of the country, where the farmers can directly negotiate the sale of their produce with ITC Limited.
• Online access enables farmers to obtain information on mandi prices, and good farming practices, and to place orders for agricultural inputs like seeds and fertilizers. This helps farmers improve the quality of their products, and helps in obtaining a better price.
• ITC Limited kiosk with Internet access is run by a sanchalak — a trained farmer. The computer is housed in the sanchalak’s house and is linked to the Internet via phone lines or by a VSAT connection.
• Each installation serves an average of 600 farmers in the surrounding ten villages within about a 5 km radius. The sanchalak bears some operating cost but in return earns a service fee for the e-transactions done through his e-Choupal.
• The warehouse hub is managed by the same traditional middle-men, now called samyojaks, but with no exploitative power due to the reorganisation. These middlemen make up for the lack of infrastructure and fulfill critical jobs like cash disbursement, quantity aggregation and transportation.
• Driven by increasing smart phone penetration in the country coupled with declining data costs, the FMCG and hospitality conglomerate plans to launch a mobile version of the programme by middle of 2019.
• Since the introduction of e-Choupal services, farmers have seen a rise in their income levels because of a rise in yields, improvement in quality of output, and a fall in transaction costs. Even small farmers have gained from the initiative.
• Farmers can get real-time information despite their physical distance from the mandis. The system saves procurement costs for ITC Limited.
• The farmers do not pay for the information and knowledge they get from e-Choupals; the principle is to inform, empower and compete. e-market place for spot transactions and support services to futures exchange.
• There are 6,100 e-Choupals in operation in 35,000 villages in 10 states (Madhya Pradesh, Haryana, Uttarakhand, Uttar Pradesh, Rajasthan, Karnataka, Kerala, Maharashtra, Andhra Pradesh and Tamil Nadu), affecting around 4 million farmers. In Uttar Pradesh, the pilot project has reached out to nearly 2, 00,000 farmers.
• As part of the e-Choupal initiative forward, ITC has also launched a program — ‘baareh mahine hariyali’ — focused on helping farmers multiply their incomes by maximising farm utilisation over 12 months of the year. The programme has been implemented in four districts of Uttar Pradesh including Allahabad, Chandauli, and Ghazipur and Bihar’s Munger district.

Conclusion:

E-Choupal, the two-decade old initiative from ITC aimed to web-enable farmers to overcome challenges related to information access and procurement, is set for a major makeover this year. The new model, called e-Choupal 4.0, will be rolled out in the next couple of months