E-choupal: How it works?

Sumit Chharia, MBA class of 2007 ,

IIIT Allahabad

ITC's International Business Division, one of India 's largest exporters of agricultural commodities, has conceived e-Choupal as a more efficient supply chain aimed at delivering value to its customers around the world on a sustainable basis.

The e-Choupal model has been specifically designed to tackle the challenges posed by the unique features of Indian agriculture, characterised by weak infrastructure and the involvement of numerous intermediaries. 

This project was launched in June 2000, has already become the largest initiative among all Internet-based interventions in rural India . 'e-Choupal' services today reach out to more than 3.5 million farmers growing a range of crops - soyabean, coffee, wheat, rice, pulses, shrimp - in over 31,000 villages through 5372 kiosks across seven states (Madhya Pradesh, Karnataka, Andhra Pradesh, Uttar Pradesh, Maharashtra , Rajasthan and Kerela).

As a company for Indian farmer, ITC has taken care to involve farmers in the designing and management of the entire ‘e-Choupal' initiative. The active participation of farmers in this rural initiative has created a sense of ownership in the project among the farmers.

This enthusiastic response from farmers has encouraged ITC to plan for the extension of the ‘e-Choupal' initiative to altogether 15 states across India over the next few years. There are plans to channelise services related to micro-credit, insurance, health and education through the same ‘e-Choupal' infrastructure.

ITC has become the first Indian company and the second in the world to win the prestigious Development Gateway Award . It won the $100,000 Award for the year 2005 for its e-Choupal initiative which has achieved the scale of a movement in rural India . The Development Gateway Award recognizes ITC's e-Choupal as the most exemplary contribution in the field of Information and Communication Technologies (ICT) for development during the last 10 years. As the largest Information Technology (IT)-based corporate initiative in rural India , ITC e-Choupal was chosen from 135 nominations from across the world.

ITC e-Choupal has already received several national and international accolades as a unique transformation model for rural India . ITC's initiative had earlier won the inaugural `World Business Award' instituted in support of the United Nations' Millennium Development Goals. ITC e-Choupal also the Wharton-Infosys 'Enterprise Business Transformation Award 2004' for the Asia-Pacific region. The curriculum of the Harvard Business School now includes a case study on the ITC e-Choupal movement and how it is enabling a paradigm shift in Indian agriculture. The ITC e-Choupal strategy also forms part of management guru C.K.Prahlad's latest book, 'The Fortune at the Bottom of the Pyramid'.

ITC e-Choupal today reaches out to and empowers over 3.5 million farmers over 31,000 villages by enabling them to readily access crop-specific, customised and comprehensive information in their local language. It provides real-time information to even the smallest marginal farmers on the prevailing Indian and international prices and price trends for their crop, expert knowledge on best farming practices, and micro-level weather forecast . This significantly improves the farmer's decision-making ability, thereby helping him better align his agricultural produce to market demand, ensure better quality and productivity.

ITC e-Choupal also creates a direct marketing and fulfilment channel for rural India , eliminating intermediation and multiple handling, thus significantly reducing transaction costs and improving logistical efficiency.

Over the next decade, the ITC e-Choupal network aims to cover over 100,000 Indian villages, representing 1/6th of rural India , and create more than 10 million e-farmers.