India has proven that digital inclusion can unlock unprecedented opportunities for value creation in the entire economy. This is made possible by the foundations of access to the internet and telecom and digital identity as Digital Public Infrastructure over the last decade, laying the groundwork for financial inclusion and market integration.
India’s Digital Public Infrastructure is thus emerging as a critical factor of production and the latest addition in this family, Open Network for Digital Commerce (ONDC) is expected to transform every domain of the economy by democratizing digital commercial transactions in products and services.
The fundamental principles of unbundling and interoperability in the ONDC’s solution architecture enable innovators to build solutions and services that will empower large and small business enterprises to have equal opportunity to participate and compete in digital commerce on the merits of their products and services.
Government-backed Farmer Producer Organizations (FPO) have taken the lead in attempting to leverage this network.
As of date, around 5,000 FPOs — each representing approximately 500 farmer members — have been onboarded onto the ONDC Network making them visible to all consumer apps on ONDC across India.
The customer orders for products at prices fixed by the farmer with supporting services of logistics are available from the network at cost transparently visible to both consumers and sellers.
Thus, with the power moving to the end nodes, benefits are accrued closest to where the value is created or consumed (the farmer and consumers), and not intermediaries.
The FPOs that onboarded ONDC have started investing in local value addition.
Aryahi Fed Farmer Producer Co from Saharanpur, Uttar Pradesh, started with packaged honey, went on to make honey gift kits, and when these got a good response during Diwali, the FPO has invested in baked products using their honey, jam made with honey, bee wax candles, pollen, infused honey varieties and even pickles.
Digital inclusion is thus enabling market-led innovation providing a new avenue and definition of what D2C brands and companies of new India can look like, while also providing for village-level entrepreneurs and the younger generation to make the most of a New Digital Rural India.
Product diversity
FPOs on ONDC offer over 250 rice varieties, both raw and parboiled, some GI tagged too, each with its unique local folklore, taste, and aroma or over 50 varieties of pure honey from beekeeper FPO farmers, in a spectrum of colours, aroma and degree of sweetness.
It’s a similar array of local products in all food sections — pulses, dry fruits, oils, beverages, fruits, vegetables, and even dry and fresh fish, opening the opportunity for these varieties to develop their brands and identities as Indian consumers experiment and try both traditional and modern recipes with diverse varieties.
Digital market integration of farmers collectives will have a multiplier effect on rural economies, unlocking opportunities for employment and income generation in India’s villages. An early example of this is the New Agriverse Farmer Producer Co from Jalpaiguri, West Bengal. The FPO’s primary crop is paddy.
However, the FPO is now growing a variety of mushrooms, from ordinary oyster mushrooms to exotic lion’s mane and selling them on the ONDC network. As more and more people are sampling the products online, the FPO has both expanded its offerings like mushroom noodles and dried mushrooms, and started receiving bulk orders for its products. Bringing FPOs to e-commerce is also a win-win for the network partners and the customers. Food and grocery are repeat orders. If the price, taste and quality click, there is customer stickiness and loyalty.
Virtuous cycle
Thus, slowly each transaction creates capacity, skills and jobs for processing, packing and logistics, starting a virtuous cycle which enables closer integration of farm economies, towards the vision of a truly unified Indian market.
ONDC is thus bridging the digital divide to harness the unlimited potential of Indian entrepreneurship and innovation in every village.
While we may associate business strategies such as cross-selling and product sampling as being limited to large FMCG brands or e-commerce companies, India’s Farmer Collectives are being empowered for products being sold online more than before, comparing ingredients of processed products, and offering competitive pricing.
And yet, these are still early pilots. As ONDC expands, there is an immense opportunity for optimising costs for farmers, such as enabling farmer collectives to buy farm inputs through the same network, be it seeds or renting agricultural implements.
At the same time, foundations are being laid for expanded financial inclusion for farmer collectives using verifiable digital transactions as the basis for credit and insurance, and building solutions such as crop planning, demand forecasting, and input advisory depending on soil topography, weather, etc. to become available for farmers in their own languages.
As Indian consumers rediscover the rich tapestry and variety of India’s farm products with the growing momentum of Vocal for Local and Atmanirbhar Bharat, the ONDC network can make the farm-to-fork model a reality.
For consumers, this unlocks the opportunity to discover the rich variety of farm products, which, be it in terms of their price, purity, variety or traceability are unprecedented anywhere else.
As the initial pilots in assisted e-commerce through the ONDC network by both government-backed organisations like Citizen Service Centres (CSCs) as well as private sector enterprises and the recent announcement of Prasar Bharti’s initiative to empower rural commerce through BharatNet are underway, there’s growing excitement around digitalisation turning Indian farms and villages into growth engines for the entire economy.
This is an initiative that can achieve its objectives with every citizen in the country playing an active role.
The writer is a Member of Advisory Council of ONDC. Views expressed are personal