NITI Aayog and Gujarat Narmada Valley Fertilizers & Chemicals Limited (GNFC) on June 29, 2018, signed a Statement of Intent (SoI) to use blockchain technology in fertilizer subsidy disbursal and management.
As per the SoI, the two bodies will work towards implementing a Proof-of-Concept (PoC) application by using the blockchain technology to disburse fertilizer subsidy among farmers, which is touted as the first time in India.
Approximately Rs 70,000 crore of subsidy is disbursed to manufacturing units every year for selling around 31 million MT of fertilisers below cost.
Though last but farmers will also be benefited as the use of blockchain in the process will bring transparency and transactions cannot be altered and digital fraud can be altered.
Notably, as the subsidy disbursal takes two to three months’ time, the implementation of Blockchain Technology will ensuure that the distribution will become effective and efficient, and subsidy transfer could be automated and made real time.
According to the media report, GNFC and NITI Aayog will jointly develop the use case, undertake research, interact with multiple stakeholders, develop blockchain solutions, exchange learnings, organise forums, and disseminate learnings across their networks.
Learnings, insights and outcomes of the PoC will enable NITI Aayog to suggest policy recommendations and actions in strengthening the subsidy mechanism, making it more transparent and immune to leakages.
The overall implementation ensures that there is no dependence on intermediary agencies to prove the validity of transactions and resulting subsidy claims.
The upcoming blockchain based process within GNFC will also use smart contracts which will enable quick and accurate reconciliation of transactions between multiple parties with minimal human intervention.
Last year in February, Indian consumer electrical equipment manufacturing company Bajaj Electricals, has had also started using blockchain technology and smart contracts, for paying its suppliers.
In the same month, Mahindra Group and IBM had announced they are co-developing a cloud-based blockchain application that has the potential to reinvent supply chain finance across India.
Recently, India’s telecom regulator TRAI (Telecom Regulatory Authority of India) also intended to utilize blockchain technology to curb pesky & irritating telemarketing spam calls.
It may also be recalled that India’s first blockchain-based network went live in April, when three online bill-discounting exchange platforms came together and implemented a solution for their operations to deter fraud.
Last October, Andhra Pradesh became the first state in the India to pilot blockchain technology in two departments – land records and transport.
Last year, we reported how blockchain is invading financial institutions like banks as well as electronic voting systems in several countries, including India.
Source – Press Information Bureau
[Top Image – CorporateEthos.com]
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