Tobacco farmers will go the electronic way soon. All the 31 auction platforms, 20 in Andhra Pradesh and 11 in Karnataka, will hold electronic auction from the next sales season, ending years of unscientific trading practices.
NIIT Technologies, which bagged the Rs 35-crore order from the Tobacco Board, will deploy relevant IT infrastructure and give mobile devices over a period of time. The BOO (Build, Operate and Own) project will be launched in Karnataka when auctions begin there later this year. Auctions in Andhra Pradesh are almost complete this season.
NIIT Tech will get 20 paise from the Board for every kg sold. It will establish infrastructure, application support and training to traders and farmers during the six-year project period. Auction platforms register sale of 270-300 million kg annually.
In the traditional system, traders quote a price through the ‘open outcry’ system that is hardly audible to farmers and deals are done even before they could comprehend the pricing patterns.
“In the present system, each bale (of 102 kg) is bar-coded and classified according to the quality. The trader has to enter a price against a particular bale and this price is prominently displayed to the farmers in the designated area. They can see the price change as different traders bid for their produce,” said Tobacco Board Chairman G. Kamalavardhana Rao.
Addressing a press conference here on Wednesday, he said e-auctioning would ensure transparency in the system and remove uncertainty and confusion among farmers on pricing. “We expect an additional income of 5-10 per cent for farmers,” he said.
The Union Ministry of Commerce had conducted a pilot run in two platforms before giving the go-ahead to the Tobacco Board to introduce the system in all the platforms.
President (Asia-Pacific) of NIIT Tech Arvind Mehrotra said that mobile devices given to traders would help conduct transactions in real time. He said Ordnance factories are using a similar solution to float tenders, award them and take care of payment cycle.