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Take a look. These farmers are well-connected

The cellphone beeps in the darkness. It’s a text message at two in the morning. Rajendra Gadiya (40) walks out of the house, softly.Nothing suspicious, just an alert for the farmer from an agricultural help centre. Gadiya looks at the skies. It could rain in two days.He defers sowing his sugarcane crop and saves himself from losing a big chunk of his yearly income.

india Updated: Aug 13, 2009 02:06 IST

The cellphone beeps in the darkness. It’s a text message at two in the morning. Rajendra Gadiya (40) walks out of the house, softly.

Nothing suspicious, just an alert for the farmer from an agricultural help centre. Gadiya looks at the skies. It could rain in two days.

He defers sowing his sugarcane crop and saves himself from losing a big chunk of his yearly income.

“It has really changed my life, this SMS service. My income has really gone up… by about 40 per cent,” says Gadiya, sitting outside his small house in Babhaleshwar village in Maharashtra’s Ahmednagar district, some 270 kilometres north of Mumbai.

Some 50 metres away is the hut where the family used to live.

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Using the additional income, his two sons are now pursuing careers earlier unimaginable for them, studying engineering and commerce respectively. One daughter studies computers; the other, social work.

For Rs 100 a year, 900 farmers in the area get alerts twice a day from the government-run Krishi Vigyan Kendra (Farming Science Centre), which informs them about rain and humidity patterns, new varieties of pesticides, and wholesale prices in different parts of the country, so that they can furiously negotiate better prices with wholesalers determined to buy their produce for less.

Expanded rural telephony, tax breaks to rural players and innovations like the SMS service could transform the economy — and millions of lives.

So here’s what we suggest: Give independence and autonomy to those handling the massive Universal Services http://www.hindustantimes.com/news/images/farmer.jpgObligation Fund (USOF), set up to develop rural phone infrastructure.

Every year, five per cent of operators’ revenues is deposited in this fund.

But the USOF has simply failed to meet its objectives. As of September 2008, only Rs 6,700 crore of the Rs 20,000 crore collected had been disbursed.

The government has now announced plans to set up lakhs of broadband connections across rural India with the funds — but that will be the first time the USOF has been accessed in years.

That’s largely because those managing the Fund currently have to follow the department's bureaucratic procedures in all decision-making and have little freedom to take financial decisions.

Meanwhile, only 12 per cent of India’s rural population has a phone connection, as against 80 per cent in the cities.

And a recent report by independent thinktank Indian Council of Research on International Economic Relations, or ICRIER, found that Indian states with higher mobile penetration can be expected to grow faster — with a growth rate 1.2 per cent higher for every 10 per cent increase in the mobile penetration rate.

Rural India has poor telephone infrastructure and far fewer phone lines per 100 people.

And even if a village has phone lines, the government has not made serious efforts to improve the quality of life with information and communication technology.

So the digital divide is widening, even though private companies are willing to go to rural areas.

“Rural India will play an important part in our drive to acquire the next 100 million subscribers,” said Manoj Kohli, CEO of cellphone service provider Bharti Airtel.

But it is expensive, gets low revenues due to the low population density, and requires strong support from the government.

It is to bridge this viability gap that the USOF was set up by under the Department of Telecommunications (DoT) seven years ago.

The USOF must now be made an autonomous organisation with independent administrative and financial powers.

It can be guided on important issues by the Telecom Regulatory Authority of India (TRAI), which is independent of the government.

“It is not simply about providing mobile telephony in rural areas,” says B K Syngal, former CMD of Videsh Sanchar Nigam Ltd (now Tata Communications). “We should aim at connecting all the panchayats (village councils) through optical fibre cable networks so that we can launch high speed data operations successfully.”

In order to bring down the cost of infrastructure in rural areas, we propose that the government also offer subsidies and tax breaks to companies setting up infrastructure there and sharing it with others.

“When we offer income-earning propositions to people, rural penetration will improve,” says Anil Sardana, managing director of Tata Teleservices.

That could touch the lives of people like Jai Singh Panwar in Uttarakhand’s Maldevta village.

Panwar sends his 15-year-old son goes to a nearby town to learn computers. He is excited at the idea of the Internet becoming available in or near his own village. He has heard about how satellite links can beam down classes from reputed schools in New Delhi.

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“Even girls would be able to get a good education,” he says.

The problem

Greater cellphone and Internet connectivity could offer rural India a window to the world, bringing them everything from SMS weather alerts to help save their crops to online lectures from the country’s best institutes. Service providers are eager to explore these untapped markets, but the scattered population and low teledensity make it unfeasible to set up the hugely expensive networks here. Meanwhile, about Rs 14,000 crore collected in a special levy on operators lay idle for years. This money was meant to be used to boost rural telephony, but remained entangled in red tape.

HT’s fix

Delink the Universal Services Obligation Fund from the Department of Telecommunications, to reduce the red tape currently holding up decision-making. Allow the fund to determine how the money should be spent. It can be guided on important issues by the Telecom Regulatory Authority of India, which is independent of the government.
Offer subsidies and tax breaks to service providers to encourage them to set up networks in rural areas, on condition that they share these networks with other players.
Set up networks through public-run companies like BSNL and TCIL. The infrastructure can then be given on lease to all telecom operators.
Offer financial and advisory assistance to entrepreneurs — perhaps under the public-partnership model — to encourage e-kiosks at the panchayat level.

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