Electronic Commerce and Opportunities for Agribusiness in India

Abstract

Electronic commerce (or e-commerce) using Internet technologies helps businesses to cut costs and cycle times, raise efficiency and provide more information, choice and value to consumers. Agribusinesses in India will need to deploy Internet technologies to gain competitive advantage and avoid isolation from mainstream businesses. Some challenges to becoming e-commerce-enabled are technical (limited infrastructure for Internet access), some are government policy-related (bandwidth, free movement of goods across states, market and trade policies), and some are legal. Many of these challenges are being addressed through both public and private initiatives. Some are specific to agribusiness: for example, relating to scope, regional specificity, the multidisciplinary nature of agricultural services, and trade restrictions on agro-products. Low levels of computer literacy and innumerable local languages compound these challenges. A two-stage strategy is suggested for agribusiness, one for improving operational efficiencies within businesses by using Internet technologies in back office business operations, and the other for delivering both knowledge and products to farmers. The first requires deploying new, generic and cost-effective Internet technologies with open standards and protocols. The second requires using Internet technologies for strategic positioning of products and services to gain long-term competitive advantage. The latter would mean persisting with conventional business strategy while using the Internet as an effective front end.