Pradeep Gooptu

KOLKATA, 10 JUNE

ITC Ltd will be expanding its e-choupal network of information and trading kiosks to 3000 sites within this financial year, a move that is expected to yield handsome rewards in the form of substantially higher monthly trading volumes done through the nodes.

"The trading volume in financial year 2001-2002 was over Rs 100 crore and close to Rs10 crore a month, which by the end of this financial year, is expected to go beyond Rs20 crore a month", S. Sivakumar, chief of the e-choupal initiative said.

The operations were also being benchmarked against the flexible local trading systems already existing in the selected states. The existing trade structure of `mandis’ and auctions were being evaluated and studied along with their cost structure before expanding the e-choupal network. "Unless the e-choupal initiative offers tangible benefits in terms of cost, market information and efficiency, the roll-out would be meaningless", said Sivakumar.

Subject to availability of information, the pace of growth in selected states was limited by the process of village selection and selection and training of the `sanchalak’ or local farming leader to manage and guide the network.

In the logistics chain, the quality of linkage of physical produce to a storage hub under a `sanyojak’ and to the company’s processing unit, also had to be improved before nodes could be commissioned, said Sivakumar.

The technology and physical aspects of the roll-out, like website erection access computer, modem connection through phone line or V-SAT or UPS-based grid or solar power systems, was the easy part of the initiative.

The company has around 1000 kiosks now and was adding on 4-5 choupals a day. This rate would be sustained till a network of around 3000 choupals were in place by the end of this fiscal. Over a million farmers would have access to the network.

The network expansion and growth could have been even more impressive had the company’s plans to roll out the network into other states proved successful. At present, it was operating in four states – Madhya Pradesh, Karnataka, Uttar Pradesh and Andhra Pradesh.

ITC has a presence in 14 states from where it sources a wide range of agri-commodities like soya, rice, coffee, edible nuts, pepper and marine products. This physical trading network was being upgraded and improved through e-choupal on a revenue model that was expected to contribute to the bottomline.

Roll-out in the other states – among them West Bengal – was held up as the necessary linkages regarding information on background issues like rainfall projects and irrigation water were yet to be worked out. Negotiations in several states were under way.

The operations in the four states operated on different time cycles, clarified Sivakumar. The Madhya Pradesh circle, for example, was passing through the busy season now as trading in wheat and soya was at its peak.