First, let us examine the supply chain in agriculture in the status quo. In most states
in India, farmers are not allowed to sell their produce directly to the consumer.
They must go through a middleman, for example, a vendor at the local APMC
market. This creates a situation where corruption and exploitation thrive. Farmers
are often not given the minimum price that they’re entitled to. In such a situation
the adoption of smart contracts could go a long way in alleviating their plights if
the infrastructure is in place. Essentially a smart contract enforces the terms of a
contract on the participants. It’s a computer code running atop a blockchain which
specifies the terms of the contract, in our case the MSP per quintal of the crop. The
middleman/vendor would transfer the money into the smart contract and the funds
will be held on the blockchain until both parties satisfy the contract. In case the
contract is reneged by a party, all transactions are reversed. This entire process is
automated and decentralized. This works particularly well in tandem with the
government’s intent on electrifying and digitalizing rural India as well. It will also
help alleviate institutional distrust within farmers as everything is open for them to
see.
On the second problem of inheritance or transfers of land titles, the most common
problems faced are fudged, missing or damaged documents. People are unable to
furnish documents either because they never had them made or because they’ve
not been able to track them down. In such a scenario let us consider a plot of land
to be a commodity. The local administrative authority would maintain a blockchain
of land titles with itself and the relevant stakeholders. So, in a case that there is a
dispute between two farmers over who has the ancestral right to the land, the
blockchain will provide a complete history of the land ownership within seconds.
Moreover, the only changes are additions so there is no question of tampering that
arises. Since transactions are completed only through consensus, and there is
transparency in the system, the possibility of reasonable conflicts arising out of the
matter is slim.
Blockchains are clearly the future. All major financial, consultancy and
technological companies are investing heavily in research and application of the
concept. There is no reason for governments to be left behind in this trend either. If
the government can carry out pilot projects in rural India and study the outcomes,
foundations for better governance can be laid down.
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