Developing and Launching agri-entrepreneurs

for doubling farmer’s profit

Distinct Horizon and Syngenta Foundation India

Submitted to:
Nestle India Ltd

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 Contents

SYNGENTA FOUNDATION INDIA – DISTINCT HORIZON.............................................3

The Challenge............................................................................................................................3

Solution: Empowering Rural Youth...........................................................................................3

The Objective:............................................................................................................................4

The Theory of change:...............................................................................................................4

AE Program Design and Implementation:.................................................................................5

Impact of the program................................................................................................................5

Urea Deep Placement (UDP) as an effective technique:...........................................................6

The Powered Urea Deep Placement (UDP) Applicator “VRIDDHI” (Internationally Patented)
Developed by IITians.................................................................................................................8

(World’s First Powered UDP Applicator)..................................................................................8

Nestle Agri-Entrepreneurs:........................................................................................................8

AEs for Nutrition:......................................................................................................................9

AEs for Precision Agriculture:...................................................................................................9

AEs for Sustainable Development:..........................................................................................10

Employee Volunteering Program.............................................................................................11

Roles and Responsibilities.......................................................................................................12

Costs.........................................................................................................................................12

Risks and Challenges with the Project:....................................................................................13

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 SYNGENTA FOUNDATION INDIA – DISTINCT HORIZON

Developing and launching Agri entrepreneurs for doubling farmer’s profit

through effective nutrient management ( UDP technology)

The Challenge

Indian agriculture has made significant progress in the last few decades. However, vast
numbers of small-sized landholders still struggle to earn decent incomes. This is because of
the lack of access and know-how of modern technologies. This is a challenge across many
sectors in rural India, but agriculture displays a particularly persistent and damaging lack of
access to:

1. Information about the new technologies

2. Credit to buy or rent them
3. Availability in near retail shops
4. Know-how and technical guidance on frequency and intensity of usage

Solution: Empowering Rural Youth

It is in this context that Syngenta Foundation India launched its Agri-Entrepreneur (AE)
initiative in 2014. The program aims significantly to increase farm incomes and to create
sustainable livelihoods for young rural entrepreneurs. The Syngenta Foundation selects and
trains unemployed village youth to provide products and services to 150-200 smallholders in
two to three villages. The AE network replaces conventional and inadequate ‘point solutions’
with one holistic provider.

AE’s provide their services for a fee. The offer includes credit access and market linkages, as
well as access to high-quality inputs and farming advice. Each AE has to come from one of
the villages she or he serves as trust is an important factor in agricultural transactions.

As of February 2020, a total of 2700 AE’s were providing services to about 250,000 farmers.
SFI aims to increase both the total number and the proportion of women. These women are

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trained to make decisions as an entrepreneur. It has been observed that a female AE typically
reach more women, farmers, than do their male counterpart.

The Objective
The main objective is to develop and anchor Agri-entrepreneurs (AEs) who will provide
agriculture services to small farmers and help them in improving their income from Agri
enterprises. Developing AEs will sustainably support smallholders in accessing cutting edge
technology in nutrient management (Urea Deep Placement), thereby increasing income and
making farmers more resilient to climate change. This intervention also helps farmers in
maximizing their benefit through the adoption of an accurate package of practices. The
specific interventions include:
1. Selection and training of Agri-Entrepreneurs at the selected project location

2. Deploying UDP machinery for AEs to launch a pay-per-use service model

3. Regular agro advisory services to producers

4. Close mentorship and handholding to ensure the following of package of practice

5. Awareness campaigns and training for farmers for increasing mechanization

6. Studies/Monitoring and Impact Evaluation

The Theory of change

The presence of village-level agriculture service providers leads to accelerated adoption of
new technologies by small farmers. AEs apart from selling the new technologies and products
also provide crop advisory, which plays a key role in improving crop yields and net returns of
producers. Tangible benefits that farmers derive on being associated with AEs are as follows:

 Crop advisory, especially with AEs visiting their fields and recommending based on
the current situation of the crop
 Reduced the cost of cultivation by providing inputs at costs lower than market prices
 Increasing the access to markets and ensuring remunerative prices for the output
 Access to allied products and services such as credit, insurance, etc
 Delivery of non-farm inputs such as digital finance, non-crop insurance, and health
services

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Although the program is designed to improve the income of smallholder farmers, the
additional benefit is creating livelihood opportunities for rural youth in the villages.
Distinct Horizon (DH) and Syngenta Foundation India (SFI), aim at leveraging their core
strengths to take cutting edge technology to farmers in Uttar Pradesh. SFI will train
and handhold 150 AEs and create a hub and spoke model to deploy DH’s solution on a
pay-per-use model to farmers as a part of a bouquet of services provided by AEs to
promote holistic agriculture development.

AE Program Design and Implementation:

Impact of the program

Major development challenges addressed

 Agricultural Productivity
 Productive Employment
 Inclusive growth
 Sustainable Agriculture
All AE’s in business for more than six months reported an increase in income. Given that
most AEs are previously either in low-paid jobs or unemployed, even the first phase of
business operation lifts their income by 10% - 12%.

The program has a significant impact on women AE incomes. Before joining, only 10%
earned more than INR 100,000 ($1400) per annum. In the program, this percentage increased
to 19%. More than 22% increased their income by 25% in less than two years.

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In Odisha and Maharashtra, the program has been running for over three years. The average
additional income for farmers there is INR 130,000 and INR 160,000 p.a. respectively. This
is more than four times what participants were earning beforehand.
Smallholders served by AE’s also enjoy significant income increases. The main boost comes
from switching to higher-value crops, for example from rice to vegetables. The number of
farmers growing vegetables increased by 48% as a result of better agricultural practices and
irrigation techniques facilitated by AE’s. Net income per acre from vegetable cultivation for
associated farmers was 62% higher than for those not yet served by an AE. Part of this
income rise stems from a reduced need for extra day-laborers. Diversifying crops they grow
also lowers smallholders’ risk.

A significant increase in per capita annual expenditure on household items has been reported
for farmers associated with the AE program for over three years. In Odisha and
Maharashtra, their expenditure on food and nutrition, health services, education, and
housing amenities increased by 13%, 28%, 37%, and 22 % respectively.

Urea Deep Placement (UDP) as an effective technique

Urea Deep Placement (UDP) involves placement of large (>1 g) granules or briquettes of
fertilizer, particularly urea at least 10 cm below the soil surface. By doing so the effectiveness
of Urea increases hence yield of rice is increased by ~ 25% whereas consumption of Urea is
reduced by about 40%. In lowland rice fields has been widely recognized as an effective
practice for transplanted rice, except on soils with a high percolation rate (Savant and Stangel,
1990; Misra et al., 1995; Bowen et al., 2005).

Presently, in Bangladesh UDP is practiced either by hand or through hand-driven applicators.

In all around 1/3rd Rice cultivation uses manual UDP and is reaping the benefit of UDP. But
both of these manual methods of deployment are highly uncomfortable and labor-intensive.

Hence despite offering significant economic and environmental benefits UDP has not been
able to gain widespread popularity in India where there is a shortage of agricultural labor due
to urban migration, the reluctance of people to do labor-intensive on-field agriculture work.
Therefore, we believe that a user-friendly low-cost powered UDP applicator could be an
effective solution for the widespread propagation of UDP.

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Even a 10% adoption of this technology in paddy cultivation across India can result in: Rs
3500 Cr of additional profit for farmers & food security for 14 million citizens. Savings of Rs
840 Cr worth of Foreign Exchange due to reduced fertilizer import. Employment linked to
manufacturing, deployment of the applicator in the field, and custom hiring services by
village entrepreneur and Considerable environmental benefits is additional benefits. Further
in the Indian Context the huge subsidy on imported Urea by Government. It can also be
saved. Thus, this is a ‘Win-Win’ proposition with huge potential for all.

In India, maize is the third most important food crop after rice and wheat. According to
advance estimate, it is cultivated in 8.7 m ha (2010-11) mainly during the Kharif season
which covers 80% area. Maize in India contributes nearly 9 % in the national food basket and
more than Rs. 100 billion to the agricultural GDP at current prices apart from the generating
employment to over 100 million man-days at the farm and downstream agricultural and
industrial sectors.
The Powered Urea Deep Placement (UDP) Applicator “VRIDDHI” (Internationally
Patented) Developed by IITians

This machine deploys Urea Briquettes at 6-

10 cm deep in the paddy field. The
deployment of Urea Briquettes is done after
the paddy field is ready for transplantation.
The Applicator deploys Urea Briquettes
before Transplantation with the help of a
Tractor.

This technique reduces the use of urea by

40%, while the yield is increased by 25%.
The labor requirement for deployment of
Urea through Deep Placement by our
machine is reduced from 10 per Ha to 1.5
per Ha thereby doubling the farmers’ profits
from rice Cultivation.

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DH Vriddhi (proprietary innovative UDP applicator developed by IITians) is a tractor driven
machine that can cover one acre in 60 minutes. This Applicator requires only one person to
operate the tractor.

Nestle Agri-Entrepreneurs
As part of Nestle CSR’s thrust towards Nutrition, Water Conservation, and Sustainable
Development of Farmers, the AE program foresees immense synergies.

Each AE will be trained in agriculture, agriculture allied, and other essential services to reach
out to 200 farmers each. These services can include, precision irrigation services, sustainable
machinery usage, an appropriate package of practices on high value and high nutrition
(fortified varieties of wheat) crops, access to digital financial services, and building rural
resilience through insurance products. Mentoring and Training of micro-entrepreneurs evoke
the need for volunteer work by employees the organization through support provided in the
form of soft-skill training workshops.

AEs will be developed under these three core thematic areas of

1) Nutrition

2) Water Conservation

3) Sustainable Development.

A self-sustainable, micro-entrepreneurship model will be utilized to take services to rural

areas that ensure continuous engagement with the community, an irreversible and continuous
impact.

This will be carried out with the following approaches:

1. AEs for Nutrition:

 The low-cost nursery is an innovative service model that has proven itself with AEs
operating out of Jharkhand and Odisha. AEs set-up low-cost nurseries to provide
high-quality seedling to a group of farmers. This ensures a good crop, the high
nutritive value of produce for the farmer and the consumer, and a steady income for
the AE. This model strengthens the existing practices in agriculture, improving the
earning capacity of both the entrepreneur and farmers.

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 AEs will be selected based on their geographies, existing cropping patterns and
potential for the service. These AEs will be trained in establishing low-cost nurseries.
An AE running a nursery will be able to earn up to INR 30,000 – 40,000 from each
cycle.
 AEs for Input Linkages including Fortified Inputs: AEs will also provide input
linkages to farmers. As a result of better aggregation and direct linkages with input
companies, the quality of inputs will be far superior, and also the cost of inputs will be
relatively lower to farmers. AE can earn at least INR 30000-40000 in a season by
providing inputs.

2. AEs for Precision Agriculture:

 Irrigation AEs: AEs in a ratio of 5:1 can be selected to provide precision irrigation
services to farmers. This will include providing access to government subsidies for
drip irrigation, connecting with service providers, and managing the irrigation
services. For carrying out these services an AE stands a chance of making INR 6,000
per acre of the area brought under drip irrigation.
 5 AEs can feed their demand to one AE, thereby sharing revenue and maximizing
reach.

3. AEs for Sustainable Development:

 UDP AEs: SFI will select a group of AEs (3:1 ratio from within the cohort of 150
AEs) to pioneer the use of the UDP technique. Additionally, SFI will deploy its
Mentor network to handhold AEs in adopting and proliferating the technology to
registered farmers. These AEs will also serve as lead entrepreneurs, with other
entrepreneurs in neighboring locations feeding leads to the AEs, thereby increasing
coverage in this phase of the program. The UDP Powered Applicator will be deployed
through these lead AEs in a cluster of 20 villages

 Farmer’s cost of Urea with deployment is expected to reduce by 30% with a yield
increase of about 25%. The deployment will regularly be monitored for 3 seasons to
assess impact. The applicator and the briquetting machines hand over price after 2
years to be INR 45,000. Training will be provided to a local entrepreneur to continue
to provide UDP service locally. UDP Vriddhi shall be sold to the AE after completion
of the project by helping to secure a loan

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 Market Linkage Support to farmers can be provided by AEs to help farmers earn a
better price for their produce. AEs can directly be linked with modern retailers, online
aggregators, and other e-commerce partners for directly procuring from farmers
through AEs.
 One AE for every five AEs can be involved in market linkages. A collection center
equipped with an electronic weighing scale and clear guidance on grading, sorting,
packaging will be provided. An AE running a market linkage activity can earn up to
INR 10,000 in a month during the season.
4. AEs for Financial Inclusion:
 Digital Financial Services are seen to alleviate the stress that farmers face and the
costs that they incur in reaching out to banks. Digital Financial Services can be
provided to farmers at their doorstep with the help of AEs. For providing these
services AEs earn a commission from the service provider. Digital Financial services
augment the role of traditional BCs by generating a continuous stream of income and
also by increasing the reach of digital financial services.
 This model is currently successfully running most prominently under AEGF’s
activities in Bihar in collaboration with Jeevika (Bihar Rural Livelihoods Promotions
Society). As a part of the Covid-19 response campaign, AEs provided easy access for
farmers to receive the support provided under the Hon’ble Prime Minister’s scheme to
support rural families through direct transfers to their Jan-Dhan accounts.
 All 500 AEs will be trained in providing digital financial services to make access to
finance easier for rural households. By providing both these services AEs will be able
to earn up to INR 5,000 – INR 10,000 in a month.
 Insurance penetration is low in the rural sector. To increase penetration, product
customization is essential along with trusted guidance. The rural population needs to
understand the benefits and trust of the insurance provider. Most prominently AEs in
Maharashtra were able to reach out to farmers with easy to understand, innovative,
and low-cost general insurance products. For providing this service, AEs earn a small
commission paid by the rural insurance service providers.250 AEs will be trained for
providing insurance services to farmers, thereby building resilience and de-risking
them. By providing both these services AEs will be able to earn up to INR 3,000 –
INR 5,000 in a month.

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Employee Volunteering Program
The 45-day residential training program for the AEs is judiciously divided between soft-skill
development and improvement of agronomy knowledge.

A Nestle Employee Volunteering Program can be initiated for mentoring AEs by subject
matter experts from Nestle. Sessions on Customer engagement and Marketing can be two
strong modules to focus on.

The Foundation pays the utmost importance to Gender Diversity and Inclusion. In light of
this, a specialized program for women AEs can be done by women employees of Nestle for
training and bouncing off ideas.

Roles and Responsibilities

Steps Organization
Identification and development of AEs SFI
Baseline Study SFI
Supply of Applicators and Briquetting Machines as per standard DH
quality and local requirements
Training AEs on accurate practices of UDP at the onset of DH
operationalization
The communication material (Manuals) required by AEs to promote DH
easy adoption of machines
Promoting Adoption of UDP by farmers SFI
Regular Handholding of AEs SFI
Specialized mentorship Nestle Volunteer
Reporting and Monitoring SFI
Program Management (Fund Utilization and Operations) SFI
Applicator and Briquetting Machine Repair and Servicing as per a DH
mutually agreed SLA

Costs
The unit cost for developing one AE is USD 1500 which is less than USD 10 per farmer. The
total Costs for deploying UDP machinery is USD 285,771 hence the total project cost is USD
510,771

Activity Description Cost/AE ($)

1 Campaign and Reaching out to unemployed rural youth and 50

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 Selection explaining the model. Screening and selecting
prospective AE’s. The ratio is about 3:1, i.e. for
every ten young people screened, we select one
prospective AE.
2 Training 45 days of residential training. 400
3 AE Mentors Each mentor manages 20 AE’s for two years. Each 750
AEM’s salary, travel, and other expenses for that
period = approx. $15,000.
4 Project leads Project leads and domain experts such as input 80
and other staff manager, marketing manager.
5 Credit An independent credit monitoring team is put in 70
monitoring place for every 200 AE’s. This team works with
team banks to facilitate credit, monitor, and ensure a
timely repayment.
6 Demonstration One demonstration farm with all innovations and 70
farms new technologies for the region is set up for every 5
AE’s. Nearby AE’s bring farmers for training. This
also serves as a business development activity for the
AE’s.
7 Digital tools AE’s use of digital tools to record transactions and 80
farmer profiles.
Total 1500

Costs of deploying applicators and briquetting machines are given below:

Particulars Cost (USD)

Cost of 50 UDP Applicator 107,200
Cost of 50 Briquetting machines 178,600
Total costs for UDP 285,771

Risks and Challenges with the Project

As this is an ambitious initiative aimed at creating 100,000 entrepreneurs and directly

impacting 15-20 million small farmers, there are certain risks associated with this initiative.
However, we are confident that these risks can be addressed.

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S. No. Risk Description
1. Availability of Mentors provide a critical
trained mentors service of handholding AEs
through their journey.
Unavailability of trained
personnel can result in high
drop-outs and unsustainable
businesses
2. AE Drop-outs Incorrect selection of AEs
results in high-dropouts
3. Unsustainable Due to various challenges that
business AEs face, unsustainable
operations businesses are a big risk faced
specifically by first-time
entrepreneurs
4. Credit support AEs and farmers might not
failure repay the agriculture loans as
the governments often
announce loan waivers
Control
Regular ‘training of trainers’ is
conducted by SFI. This includes
training of personal development
and also on technical agriculture
aspects
The standard and tested process for
SFI selection have to be followed
along with community
endorsements of selected personnel.
At least 20 percent of AEs would
drop-out and this should be
factored into the project design
SFI team helps in creating complete
value chains, from inputs to the
market linkage, thus supporting an
AE at every stage of business
operations.
Regular monitoring with tracking
of transactions and feedback from
farmers helps in supporting AEs
better
 Creating first loss guarantees
 Providing in-kind loans byways
of assets (poly houses) to AEs,
which can be liquidated and
transferred to new AEs

Work Involved
S.N Step Work involved
1. Campaigning and  Campaigns will be run in to identify suitable pools of

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 Selection unemployment
 run in selected areas, with guidance from local
organizations and panchayat agencies.
 500 interested youth from the location will go through
written and psychometry tests as well as interviews.
Based on these 150 suitable candidates will be identified
with the right attitude and business aptitude.
2. Training  Selected candidates join a 45-day residential program at
one of SFI’s 14 ‘Centers of Excellence’.
 The training provides a judicious mix of crop
knowledge, basic aspects of agri-business management,
and soft skills.
 The curriculum is prepared in-house by subject-matter
experts; the training runs using digital tools.
 Special ‘all-women’ training is available to increase
female participation. SFI now has one exclusively
female training center in Eluru, AP.
3. Launch of AE  After training, we help AEs set up an agriculture
Enterprise enterprise (input shop, nursery, farm machinery rental
shop, or collection center for market linkages).
 We also assist AE’s with their business plans and
operationalizing their enterprise.
4. Mentoring  An AE Mentor (AEM) is an agriculture graduate who
manages 20 AE’s on a day-to-day basis. An AEM’s
principal role is to help AE’s establish their business and
serve about 150 smallholders.
 Each AEM visits the AE’s at least once a week to
review progress and help with any issues, e.g. related to
credit access from banks and financial institutions,
connection to partners such as input or machinery
companies, etc.
 The AEM also checks that AE’s adhere strictly to the
processes to improve farmer income. This includes a

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 sharp eye on service quality. AEM’s ensure that AE’s do
not sell any spurious items and that farmers benefit fully
from produce aggregation.

Evaluation Methodology and Indicators

The Evaluation methodology will include using validated administrative data provided by
AEs through digital tools. Additionally, a Baseline, Midline, and Endline will be conducted
to assess the impact.

 Increase in AE income and profitability

 Number of farmers served at the end of both Kharif and Rabi

 Number of acres covered at the end of both Kharif and Rabi
 Number of training conducted
 Feedback from farmers served
 Increase in farmers income
 Increase in application of UDP techniques

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