Every once in a while, a technological innovation breaks through from the
cloud of abstract ideas and captures the imagination of technologists and the
laymen alike. In 2018, there are several innovations that fit the bill, however, none
have as wide and far-reaching potential as perhaps blockchains do. From
threatening the status quo in terms of how the financial world operates, to
revolutionizing supply chain structures, blockchains seem to be a ubiquitous
solution to a myriad of problem statements. However, in this article, the key focus
will be on applying blockchains to alleviate socio-economic problems that arise out
of India’s agrarian issues. But first, what are blockchains and how do they work?
The best way to think about blockchains without getting involved in the
technicalities of the underlying implementations is to take a real-world example.
William Mougayar, the author of The Business Blockchain, described it this way:
“Imagine two entities (e.g. banks) that need to update their own user account
balances when there is a request to transfer money from one customer to another.
They need to spend a tremendous (and costly) amount of time and effort for
coordination, synchronization, messaging and checking to ensure that each
transaction happens exactly as it should. Typically, the money being transferred is
held by the originator until it can be confirmed that it was received by the
recipient. With the blockchain, a single ledger of transaction entries that both
parties have access to can simplify the coordination and validation efforts because
there is always a single version of records, not two disparate databases.”
Simply, the blockchain process validates transactions through consensus.
Moreover, the distributed ledger aspect, i.e., records are available to view to all
concerned parties always, creates trust through transparency. Lastly, blockchains
are immutable. This means you can only append transactions, even editions are
appended. Hence, for any commodity, all transactions are maintained in their
original form. This dispels any possibility of tampering, theoretically and to a great
degree, practically.
Now to the more pertinent question of which agrarian problems can be tackled and
how. India’s agricultural landscape is plagued by two major problems. Corruption
in the supply chain, and disputes over land inheritance. Other issues exist, however
for the purpose of this article let us consider these.
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