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PROF. T KUMAR RUKSHANA PRAVEEN

KSRM ROLL - 9201033


 

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E-Kutir is a social enterprise wedded to the objective of eradicating poverty and hunger in a
unique model. The model is entrepreneurship driven, ICT enabled and participatory. The
target group is small and marginal farmers in Orissa, one of the poorest states of India and the
project e-Agro is being implemented in partnering with Grameen-Intel Joint Venture. The
Vision behind the farmer¶s e-Kutir e-Agro initiatives are:

È àuild a sustainable e-enabled Agriculture service business targeting provisioning of basic

necessary agricultural services to the small farmer by connecting the rural farmers to
existing islands of expertise/capabilities/markets (e.g. access to appropriate financial
instruments, genuine seed & fertilizer supplies, agro advisory, access to best cultivation
and risk mitigation practices, soil testing to understand the nutri-capability of land and
map with best crops, labour Vs mechanization, market connections for best price
discovery & transactions) delivering these in a simple, one-stop-shop type, hassle free,
affordable and integrated manner, by leveraging low-cost ICT advances, involving rural
institutions and communities (for their knowledge expertise, enablement of transactions
& sustainability considerations).
È In the process, the aim has been to build appropriate, easy to use ICT solutions that would
enable the scaling/replication of the operations resulting in extending the services and the
benefits to larger communities on a global scale.

The effort has been to identify grass roots agro-entrepreneur talent, nurture them and create
scalable & sustainable engines for entrepreneurship, livelihoods & resultant economic growth
that fosters rural development through leverage of ICT.

Key to achieving this element of sustainability of this àottom-of-the-Pyramid oriented

service business is the value chain ± and it is crucial that each and every party in the chain
brings a value-for-value exchange i.e. it has to be ensured that each brings certain value for
which they benefit appropriately. The pivot of this operation, in the village is the local
entrepreneur, who understands the agro scenario, the lay of the land, has the necessary
relationships, the relationship management capability, basic business acumen and drive and
most importantly, has the inclination to bring about social change by interfacing with the
multiple agro stakeholders, representing the farmers issues and solving this through
consultation.

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È Realization that ICT can play a significant role for their service delivery and instant
information reach.
È E-Hub has created such an impact that it has become an epicenter of all farmers activities,
going beyond the agro livelihoods and services, but also touching on issues like finance,
healthcare, education.

). ày forming FIG and attending the meeting- a major social transformation

)). Farmers talking about their individual and common needs & prioritizing the requirement.
))). Participating in structuring and deciding the cost of services/ Registration fees:

È The productivity increased due to soil testing, proper crop advisory, getting right seed at
the right time, access to best cultivation and pest/disease avoidance techniques, cost and
price advantage due to collective leverage and access to multiple sources of supply and
markets.
È A sense of ownership, from farmer ± 1st indicator of sustainability.
È A sense of optimism- that they can actually control their destiny and make progress.

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È Operating breakeven achieved within 4-5 months, and at only 20% capacity- Successful
demonstration of model where village entrepreneur¶s risk taking & financing has taken
off.
È Ample potential and headroom for further business growth.
È A realization that there is an opportunity & space in the rural area to do business with a
difference.
È Obvious growth in self-confidence, pride and status.
È Success begets success: entrepreneur now wants to invest in other lateral opportunities
like farm machine leasing, contract farming, logistics support.
È 2emonstration of the opportunities for the other local unemployed youth to be gainfully
engaged.
È Peer pressure: 2emand from other people to also establish similar such centres nearby.

Economic viability means the capability of developing and surviving as a relatively

independent social, economic or political unit. Asian 2evelopment àank (A2à) has defined
economic viability as the assessment that increases in output produced by a project using the
least cost method will recover costs, provide an additional required rate of return (RRR) and
sustain effective production in the face of uncertainty and risk. This e-Agro project is a
farmer livelihoods improvement initiative by which it can provide the farmers with services
which can benefit the farmers. So to assess the economic viability of e-Kutir, one has to see
the economic viability of the stakeholders of the project. The stakeholders of this project are:

  %$%+ The impact of the project is visible from the results of the registered farmers at
e-Kutir whose returns has increased from 50% - 400%. This is economically viable for
the farmer as he doesn¶t have to go to the local moneylenders for funds and thus giving
him a sustainable way of earning his livelihood. Also it helps the farmers to select best
seeds, fertilizers, soil testing and various other agri-related services at a reasonable cost.
(  ' %$%$'$(%+ The entrepreneurs here are generally have skills but don¶t have the
sustainable way to earn their livelihood. One e-Kutir entrepreneur earns as much as Rs
10000/- per month due to this initiative.
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#!,$ This project is not only for the farmers but also it helps in other
aspects such as finance, health and education. People are now more educated and aware
of the happenings in their surroundings. It has created job opportunities and also has
provided access to nearby markets. It has also facilitated with the price discovery
mechanism of their commodities so as to get a fair price for their produces.
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e-Kutir, being a JV has to earn some profits so as to sustain itself. Now it is
funded by the Grameen Intel Foundation, but to become an economically viable project it
has to earn profits. Thus it gets its revenue from various registration fees, soil testing fees,
 etc. Though the profits are nominal yet it is prudent to be less dependent on outside fund.
The revenue model of e-Kutir is as follows:

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Entrepreneur 50%
e-Kutir 25%
Farmer 15%
Retained Earnings 10%

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Microfinance institutions are also more inclined to borrowers who have the
essential requirements of repayment of loan timely. When the farmer is economically
sound then the MFIs are more than willing to give them loan. So this is a win-win
situation for both the farmer as well as the MFIs thus opening a new way towards
economic sustainability.