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 management. As per the SoI, the two bodies will work towards implementing a Proof-of-Concept (PoC) application by using the technology. 

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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 blockchain technology will be used in fertilizer sector with an aim to make the fertilizer distribution system efficient.  

Under the SoI, the two parties will undertake joint research, interactions, exchange knowledge, organise forums and disseminate learnings across their networks. Usage of blockchain technology in the fertilizer sector will enable the government to bring efficiency in the fertilizer distribution system and make it a leakage-proof system. It will also allow the government to reduce the time period of providing the subsidy to fertilizer manufacturing companies from 3-4 months to 3-4 weeks. 

There were several leakages in the fertilizer sector from the point of production to point of consumption. And the use of GNFC blockchain technology in the sector will help us to monitor the movement of the fertilizer on the real-time basis and put a stop on leakages. It will increase its production by making the system efficient. In short, the technology will be playing a developmental role in the country", says Amitabh Kant, CEO, NITI Aayog. 

GNFC will be launching the pilot project of blockchain technology usage in the fertilizer sector. Blockchain platform has inherent characteristics of distributed computing and digital signature implementation .i.e. confidentiality authenticity, non-repudiation, data integrity and data availability. 

Today's system is multiplayer, multi-functional, multi authentic and multi-agency network, .i.e., there is a three-four months gap in subsidy issuance to the fertilizer manufacturing company after it is sold to the farmer. Several agencies and numerous paperwork are involved in the process. But the use of blockchain technology in fertilizer distribution will reduce this time period of three-four months to three-four weeks. It will bring efficiency in the fertilizer distribution system, says Dr Rajeev Kumar Gupta, MD, GNFC. 

Gupta also added, "Blockchain technology will bring efficiency into the whole system of subsidy under which the government pays a subsidy of nearly Rs 70,000 crore to different fertilizer companies. Agencies involved in the process are aware of their part of the job and thus there will be no need for authentication in the system. It will bring transparency and speed to the system. Farmers will be the last beneficiary of the process". 

Gujarat Narmada Valley Fertilisers & Chemicals

Gujarat Narmada Valley Fertilizers & Chemicals Limited. (GNFC), is a joint sector enterprise promoted by the Government of Gujarat and the Gujarat State Fertilizers & Chemicals Ltd.(GSFC). It was set up in Bharuch, Gujarat in 1976. Located at Bharuch in an extremely prosperous industrial belt, GNFC draws on the resources of the natural wealth of the land as well as the industrially rich reserves of the area.

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GNFC today has extended its profile much beyond fertilizers through a process of horizontal integration. Its corporate portfolio includes chemicals/petrochemicals, energy sector, electronics/telecommunications and information technology.