Do Minute Desh Ke Liye

CONTEXT:
India is currently the second largest producer of Food grains, Fruits and Vegetables globally and
has moved to a comfortable surplus position. This signifies immense opportunity for Indian Food
Processing Industry to move up the value chain. The Food Processing Industry serves as a critical
link between Agriculture and Food Processing sector of the economy. Strengthening this link
between food processing and Agricultural sector is a winning proposition to improve value addition
in agriculture, ensure remunerative prices/income levels to farmers, support employment and at
the same time create a sustainable base of quality raw materials available for processing.

In last few months there are some historic steps taken by the government for the Agriculture sector
through below policy reforms as well as Agriculture Infrastructure fund of 100,000 Crores

• Farm Produce Trade and Commerce ordinance

• Farmers agreement on Price assurance and Farm services
• Amendment in Essential Commodities Act
This opens opportunities for the Food Processing sector to think progressively toward reinforcing
the strong mutual dependence with Agriculture. These reforms should enable innovations around
buying models, price discovery and possible precompetitive partnerships among value chain.

CASE:
Nestlé India, one of the largest Foods and Beverages company of India sources over 400,000 MT
of processed Agri based raw materials across length and breadth of the country. Some of the key
strategic raw materials for our MAGGI brand include Wheat Flour, Spices and Tomato paste. The
sourcing of processed raw materials is done through a network of an approved and reliable vendor
base. Every vendor has their own model of further sourcing of base raw material depending on the
product, geographical presence, vendor capabilities and product requirement.

Currently MAGGI has traceability and backward integration projects in spices in partnership with
our vendors in six different states for 6 different spices. Traceability on one hand helps the farmers
to directly connect to their end customer while on the other hand help the consumers get a
panoramic view of practices at source. Such associations are often complementary since the gap
between requirement and availability is bridged, mutually benefiting consumers and producers.

The approach of these projects is to identify the needs of farmers in growing regions in terms of
agronomic practices, pest management, post harvesting, water and soil conservation awareness.
These projects get tailored around these needs and implemented through our vendors with our
regular supervision and interventions.
The aim of such projects is to strengthen our sourcing base for critical raw materials through
sustainable practices of agriculture and have a positive impact on the society we operate in. These
projects also help the farmers in multiple ways, some of which are:

1. Educate farmers about existing government (national or state) schemes and services that could
support their resilience
2. Increase crop yield by water management, information on high quality seeds and better
fertilizers
3. Encourage sustainable agronomic practices
4. Farmers are encouraged to educate children and empower women to work
5. Educate farmers on sanitation facilities in villages and clean drinking water for field labor

Basis our experience of implementing such projects on ground these are the major areas where
focused interventions are required to improve the livelihoods of farmers:

1. Diversity of source of income – Overdependence on a single crop

2. Stagnant productivity vs increasing cost of cultivation
3. Post-harvest losses and lack of storage infrastructure
4. Value addition and quality differentiation at farm
5. Access to technical knowledge and market
Deliverables:
We believe successful farmers are skilled at coping with risk, from weather to markets, and a
variety of other uncertain factors. We want to enable farmers with a cost-effective business plan
that creates a sustainable revenue stream with efficient cost management and encourage
environment sustainability.

Taking into consideration the current macroeconomic landscape, changing consumer preferences
& dynamic crop patterns basis seasonality, it is advisable to do a situation analysis of issues &
opportunities. Teams are to prepare an integrated Business Plan to help (Sahayata) our Indian
farmer, making the entire end-to-end process more efficient and effective.

Some areas of initiatives that can be explored (but not limited to):

1. Improvement in yield and farm to market linkage

2. Leveraging digitization to connect with experts, vendor partners & book orders
3. Opportunities with B2B e-commerce platform to market/sell their non-perishable products (e.g.
spices)
4. Opportunity to collaborate at regional level to promote a regional specialty (Rajasthan Cumin,
Guntur Chilli) using digitization / collaboration with a B2B / B2C e-commerce partner
5. Predictive demand modelling to enable farmers plan their land utilization effectively (crop
rotation, organic produce, medicinal spices; global trends)
6. Explore scope for Farm / Agri tourism (on the lines of spice farms and coffee gardens)

A holistic and implementable model with or without partnerships shall be evaluated for
implementation. The solution can be specific to a crop region but scalable across the geographies.
It should have a positive impact on sustainability pillars of People, Planet and Profit.