Could the Central Government’s new Farm Bills further strengthen the Reliance monopoly, finally bringing agribusiness under its umbrella?
The question, ‘why are farmers protesting?’ has made endless rounds across the internet. Most people standing with the farmers fear that the Farm Bills, introduced on 14th September, 2020, will privatize agriculture, vesting all the power with corporates and leaving the poor farmers at the mercy of big sharks.
Amid all the mayhem, what people are missing out is this that Reliance‘s telecom arm Jio announced an agri-tech app JioKrishi back in February 2020 to create a farm-to-fork supply chain in India. Seven months later, three Farm Bills were introduced by the central government.
Reliance JioKrishi App – A lucrative prodigy with punitive possibility
Whether or not Reliance Industries will benefit from the Farm Bills will be seen in time. All set to be launched in partnership with Facebook, the JioKrishi app is Jio Platform’s maneuver to expand its reach in the agri-tech domain in India. The app, which is currently in beta stage, is projected to provide the following utilities to farmers:
- Farm-to-fork Supply Chain: The platform will facilitate the logistics of produce from harvest to store in a delivery cycle of 12 hours.
- Integration with WhatsApp: The app will provide various alerts and updates to the farmers like weather forecast, seasonal pest alert, tips & tricks, etc., incorporated from the JioKrishi app to the user’s WhatsApp.
What’s Contentious about the App?
To create a state-of-art digital utility platform like the JioKrishi app, and to provide farmers and stores with accurate information, the app will need massive amounts of data connected to the involved parties. This data will allow it to get real-time insight about crop yields all over India along with advantage in pricing while purchasing directly through the app. Furthermore, it can also lead to hoarding of produce (as seen in maximum cases) only to sell them later, thus controlling the price mechanism of the market. Such a system will further benefit services provided under Reliance’s Retail arm like JioMart and Reliance Fresh. The company has already partnered with hyperlocal platforms like Flipkart, Dunzo and Swiggy to set up the supply chain.
Imagining a worst-case scenario, the farmers will be producing crops, selling them on JioKrishi app through the Jio telecom service to eventually reach the end-consumer on JioMart. The interconnected ecosystem, coupled with Reliance Industries’ spending power could well establish a monopoly that extinguishes competition from the market in no time.
The Reliance Pattern
The Indian telecom industry has historically been one of the most competitive and heavily regulated around the world. There was a time when consumers had a plethora of choices to pick from — Aircel, Uninor, Idea, Tata Teleservices, RCom, Vodafone, and Airtel to name the major ones. Fast Forward to Jio’s entry into the telecom sector. Today, India has only three major service providers — Jio, Airtel and VI, the merged entity Vodafone-Idea.
Jio lured people with dirt cheap tariff plans for calling and internet usage with the help of an endless investment pit powered by parent company Reliance Industries. It continued the benevolence until all its competitors vanished one by one. And once it succeeded in creating a monopoly, new tariffs were released with hiked prices.
A similar route is being anticipated by many market analysts, and feared by agricultural experts and protesting farm unions, in the case of the JioKrishi app. The platform provides convenient utilities as a means of luring farmers into using the service, thereby providing Reliance with real-time insight and data to control the supply chain. The fact that business behemoths abuse power to expand empires is well documented across the world. The biggest example is JioKrishi’s partner company Facebook, which is charged with an Antitrust lawsuit by the authorities if the US for creating monopoly and stifling competition.
In a perfect world, the finance and commerce ministry of any country would have easily recognized such situations before they arise. But while the government should have devised a way to regulate service providers like the JioKrishi app, it instead paved a smoother path for corporations with bills tailor-made to the their needs and catering to their wish of eliminating “government-authorized middlemen” and making farmers sell directly to corporations.
Contrary to the government’s narrative, the fact that 85% of the farmers own less than 2 hectares of land, makes them ill-equipped to directly carry out business with corporations. Undoubtedly, the Farm Bills need a lot more protection and safeguards for the farmers, making them immune to the dangers that they could stand exposed to. Add to that the need to have more regulations for the giant sharks looking for opportunities to monopolize the Indian market.