Saturday, 9 August 2014

Redefining Crop Diversification in India in Terms of Industrial Ecology

David James*
CEO, ChloroEarth® - Rebuilding With Nature©
Karnataka, Bangalore, India
How to cite this article:
James, D., (2014). Redefining Crop Diversification in India in Terms of Industrial Ecology. Indian Botanists.

Editorial handling: Arpita Bhattacharjya, Section Editor, Indian Botanists

Crop diversity is more restricted to yield per acre or productivity of the standing crop alone. These could be broadened by including the income from crops by different means and from diverse sources, like industrial and business applications of agriculture produce and residue. Scope of industrial application of agri-residues can be explored more efficiently by properly addressing the challenges. Industrial ecology based on agri-residues will boost the economy and increase the livelihood of farmers maintaining sustainable agriculture resources.


Abundant academic literature is available (Ramakrishnan, 1994; Kothari, 1994) that bemoans the loss of India’s “crop diversity”, including the possible reasons behind it. One theme running across this literature is that this loss of crop diversity has contributed to the depletion of farmer’s income and has left them subservient to landlords and agricultural brokers. Other thoughts attribute the depletion of farmer’s income to the decline of genetic diversity within agricultural genome in India as well.

However, on scrutinizing the literature, it appears that the definition of 'crop diversity' is restricted to ‘yield per acre’ or 'productivity' of the standing crop alone.

Contrastingly, the writer posits that this current definition of crop diversity is static because it is restricted to this narrower focus of a farmer’s crop bouquet and yield. Solutions recommended to increase crop diversity is also nuanced towards the Indian palette or table alone.

This truncated definition may be part of the problem, not the solution to alleviating poverty in agrarian India.

The writer recommends that the definition of 'crop diversity' could be broadened to include a portfolio of income, not just from crops, from diverse sources, like industrial and business applications of agriculture produce and residue, these agri-residues lie wasted because of unrecognized monetary value.

In this context, the writer demonstrates the narrower and traditional definition of crop diversity, in the first part. In the second part the writer raises the potential of viewing crop diversity from the prospect of industrial use of agriculture that can in some instances equal or even rival the traditional source of farmer income. The writer introduces the potential of industrial ecology with examples that would provide additional income from agricultural residue to raise the income of marginal farmers. The writer suggests that folding in this expanded definition into the current 'yield per acre' definition may raise the rural per capita income by several multiples. 

Current Scenario: Restricted View of Diversification Focused on Horticulture

Agronomists focus mainly on staples as a primary benchmark, stemming from the rightly placed priority on the issue of 'food security' that India sought to address. Current literature regarding crop diversification examines data on whether India has diversified towards 'value added crops' or 'high value agriculture commodities (HVAs)' and examines what they are (Brithal, 2007).

Since the 1980s, India fostered large agrarian industrial solutions to squeeze more from the same soil, shifting from the traditional agrarian practices of small landholders that traditionally produced for themselves and their community. This shift was supported by agricultural subsidies that resulted in more mono cash crops grown by larger industrialized land holdings.

However, during 1990s, India became self-sufficient in grain production, which triggered diversification out of staples. Importantly, the food basket of consumers underwent a significant change during the 1990s; the per capita consumption of cereals declined, while that of high value commodities like fruits and vegetables increased considerably. One measure that agronomists employ is the share of agrarian land devoted to fruits and vegetables that have increased in each state, and can be considered an indicator of crop diversification.

Figure 1: Share of Land allocated to fruits and vegetables in the various states over time (1980, 1991, 2003) Source: National Account Statistics, Various Years.
There is supplementary literature (Birthal, 2007) that supports the view of this dispersions of staple crops vs. HVAs across small land holders that the reader can independently peruse. However, the point the writer wishes to draw out from Table 1 and Figure 1, is that the definition of crop diversity towards 'high value commodities' is still restricted to fruits and vegetables in India, this in part may be driven by what is perceived as a perspective towards the evolving urban and domestic palette away from traditional staples. 

Challenges in Monetizing Agri-residue

From the perspective of poverty reduction, crop diversity towards table centric HVAs is particularly appealing because HVAs have low gestation periods and purportedly have high returns. When examining this claim while interviewing small land owners across parts of the country particularly as an incubatee of TNAU, the author had to examine the feasibility of monetizing agri-residue and what kind of potential problems farmers faced. It emerged that the transition towards high-value agriculture is not without challenges, especially for small land holders. These challenges include, but are not limited to:

i) Access to Information: Again, assuming that an economic case may be made to diverge into HVAs or products that farmers have not grown before, implies the farmers will lack necessary information on production methods, marketing opportunities, and the probable net returns. Of course, the farmers can attempt to gather information, but this often involves a fixed cost (one not related to the level of output), thus giving an advantage of scale to large farms. Some HVAs also require significant investments, including the use of specific inputs. For example, fruit production typically means that the farmer must plant trees and wait 3-5 years for them to begin producing.

ii) Access to markets: The marketing of highly perishable HVAs benefit from the producing farm being located near markets and good marketing infrastructure. A small farmer who allocates land to a commercial crop often has to depend on market off takes, resulting in an additional source of market risk.

iii) Lack of capital: Finally, farmers in developing countries such as India, particularly poor farmers, often do not have the access to capital to make these investments and purchase the necessary inputs.  

Some of these challenges and costs listed above indicate that the trend towards conventional or table centric HVAs has not led to a substantial rise in small landowners incomes (Miyata, 2009). Now, if these constraints become redundant through approaches like monetizing agricultural residue at near zero marginal costing and yield higher incomes , these innovations merit closer examination. 

Industrial Ecology and the Use of Agrarian Residue for Industrial Applications

Industrial ecology seeks to link together industrial processes and demand so that one process makes use of the by-products of another that would otherwise go to waste. In this way resources are used more productively, less hazardous waste and other pollution is generated, and material, energy and water throughput is minimized. This raises some interesting possibilities in the amount of agricultural by-products that India ejects but lies unrecognized for its potential as a raw material or inputs to other industrial processes.
Monetization this agri-residue is a substantial economic contributor, in some instances may match income compared to their current crops. Similar manufacturing processes that address demands for products like bio-degradable packaging materials for the food industry, insulation and stress panels for automobiles, 'green' building materials and non toxic adhesives derived from bio-polymers are examples of 'new materials'. These 'new materials' are derived from sustainable agriculture sources, and are driven by OECD countries' new regulatory frameworks on health quality and sustainability ( This demand is currently estimated to be around US$150Bn. per annum and is growing by 15% per annum (Mohanty, 2005).

This demand cannot be met by any single country or source. Unknown to many, including people in India, India enjoys an un-rivalled supply of such agri-residues that no other country can match because of her agrarian and vegetarian habits. Agri-residues when monetized for industrial applications, prices paid to farmers that are indexed to dollarized sales will command a far higher 'Economic Value Added (EVA)' than the current practice of growing HVA crops for the Indian table.

The simple financial model implies that, at near zero marginal cost to harvest this 'waste' is less than the cost of producing conventional HVAs like fruit and vegetables, and assuming the monetization of these residues is on par with HVAs, it makes business sense to invest in agri-residue monetization strategies. It is this income potential from agriculture residue or agricultural by-products that serve as an input or raw material to another industry should make a case in redefining crop diversity. This extended definition extends beyond the traditional 'yield per acre' re-position farming as a business that responds to industrial trends instead of the food palette alone.

The writer suggests the term 'agri-residue' be used instead of agri-waste' as part of the expanded definition since the residue has a higher intrinsic economic value when it becomes an ingredient to an end use industrial application. If such residues do not disrupt the food and fodder chain, then such residues transform into 'super HVAs' because it delivers a bonus at zero marginal costing. The techno-commercial aspects of specific 'industrial products' from agri-residue cited here go beyond the purpose of this article, which primarily seeks to stimulate a discussion to broaden the definition of crop diversity into income from industrial applications.

Significance of Industrial Ecology in Crop Diversification

It is very much possible that farmers can diversify into agriculture by producing purpose grown non-food crops alone, however, it is this sector that we can turn to for success stories on how purpose grown non-food industrial crops contribute enormous economic value. These illustrations are then extrapolated to food crops that do not require invasive or interventionist practices, nor disrupt the food or fodder cycles, and are cited as examples only.

Some of these purpose to grow non-food crops include: i) Pharmaceutical crops and related products. ii) Energy crops. iii) Industrial fiber crops - e.g. jute/hemp, flax and corn stover iv) Some industrial forestry crops are purposely grown as a mitigant to deforestation and climate change and are used exclusively for in the textiles industry and for paper making. v) Short fibers are taken from the woody core of hemp - known as ‘shiv’ or ‘hurd’ - or from cereal straw and miscanthus. Their main uses are: construction biocomposites, strawboard manufacture, insulation materials, animal bedding, biocomposites for the automotives industry - e.g. for car door panels and parcel shelves, insulation materials

Industrial fiber production can compliment sustainable farming policies. Fiber crops are also heavily used by the automotive and construction industries, but our exploding automobile sector in India treats such green and sustainable initiatives with scant attention. A conundrum that merits a mention is that most agri-residues that can provide intermediary ingredients or inputs to a final product are normally manufactured outside India. These manufacturing hubs are extremely advanced in their vision but lack the proximity to adequate agriculture raw materials supply to give their operations true industrial economies of scale. These upstream supply of raw materials are grown in agrarian economies like India and Africa, but ironically have not down streamed their activities to create these value added finished goods.

Examples of Agricultural Industrial Ecology

The author would like to cite just a few examples of world demand and potential from India. One of the author’s first pilots demonstrates the potential of  'low hanging fruit' that incorporates industrial ecology as part of the crop diversification mix. Further, these examples allude to advantages India still has over the rest of the world:

i) Fracking: A success more familiar to the Indian subcontinent has been the contribution of Guar Gum to the US fracking industry. The Guar or cluster bean (Cyamopsis tetragonoloba) is an annual legume that is drought and heat tolerant and grows well in areas like Kutch, Gujarat and Thar, Rajasthan. Traditionally, it has been used as forage, feed, or as green manure in farming. The other industrial application is the production of guar gum from the guar seeds which can be used as an additive in processed foods. Recently the demand for guar gum for fracking of oil and gas formations has led to a sharp increase in demand worldwide and this has provided an added source of income to guar growers. The inflated prices of guar due to this success story is rarely discussed as an example of a non-food contributor to raising farmer’s incomes despite the fact that the supply of Indian guar gum to kick start the US fracking industry is now well appreciated. 

ii) True Green Wood Analogue from Agriculture Residue: What began as a late-20th Century wonder material, for military aircraft, carbon fiber was then adopted by the motorsport world for strength, low weight and energy dissipation. Yet now, well into its career as a mission-critical material, carbon-fiber has also become window dressing in the aftermarket. Faux carbon fibre key fobs, shift knobs and dash appliqués for '60s muscle cars are all generating real sales and real revenue. However, it is still very expensive to make in large pieces and quantities, it requires copious energy to manufacture, can be very brittle if made poorly, is not recyclable and can impose a detrimental impact of the environment when being produced. In other words, it is ripe for disruption. Similarly, the world is racing to find renewable alternatives from agriculture that go beyond a bio-composite that can replace structural products of high carbon and energy footprints like concrete and hard wood trusses. These breakthroughs derived initially from Bamboo, Sorghum, Kenaf , fused the lignin with biopolymers and go beyond bio composites. In the opinion of the author and his team such innovations are a leading socio-economic and technological disruption. These 'new material' composites are now referred to as the poor man’s 'carbon fiber' gifted from the third world. The author’s pioneering innovations that reflect bio-mimicry, provide alternatives to structural building products and draws parallels to the applications of carbon fibre today.

iii) Furfuryl alcohol: Furfuryl alcohol is manufactured industrially by the catalytic reduction of furfural which is obtained from corncob and sugar-cane bagasse.   It finds use as a solvent, but is primarily used as an ingredient in the manufacture of various chemical products such as foundry resins adhesives and wetting agents. Furfuryl alcohol has been used in rocketry as a fuel which ignites hypergolicaly (immediately and energetically in contact) with white or red fuming nitric acid oxidizer. Further, because of its low molecular weight, furfuryl alcohol can impregnate the cells of wood, where it can be polymerized and bonded with the wood by heat, radiation, and/or catalysts or additional reactants. India imports about US$ 1.4Bn of furfural and derivatives per annum when all of India’s requirements can be met and even exported by India’s agricultural sector ( 

iv) Cashew Shell Nut Liquid (CSNL)/Cardanol: Cardanol is a phenolic lipid obtained from anacardic acid, the main component of (CSNL), a byproduct of cashew nut processing. Cardanol finds use in the chemical industry in resins, coatings, frictional materials, and surfactants used as pigment dispersants for water-based inks. Despite all these uses, only a fraction of the Cardanol obtained from cashew nut processing is used in the industrial field. Therefore, there is still interest in developing new applications, such as new polymers. India was one of the largest producers of CSNL from its extensive cashew crops but its full production is barely exploited to meet Industrial demands (Viswalingam and Solomon, 2013)

v) Natural Oil Polyols (NOPs): Also known as biopolyols, are polyols derived from vegetable oils . The primary use for these materials is in the production of polyurethanes. NOPs all have similar sources and applications, but the materials themselves can be quite different, depending on how they are made and it end use. Castor oil is the only commercially-available natural oil Polyols that is produced directly from a plant source: all other NOPs require chemical modification of the oils directly available from plants. India’s castor stock is one of the largest and is a very resilient crop to grow and maintain. India’s farmers can be a global supplier if this castor production is purposefully grown to extract polyols (

vi) Bio Plastics: Today we have innovative manufacturing process for the production of polylactic acid (PLA)-based bioplastics from agricultural waste such as the inedible parts of plants, such as seeds, husks, bagasse, grasses, etc. (PLA) is created from fermenting and polymerizing sugars harvested from plants. PLA itself is not unique but the manufacturing process for bioplastic production from agricultural waste is driven by OECD’s desire to reduce the potential impact on the international food supply by using the inedible parts of the plant as their raw material as opposed to the edible part. Bioplastics command a premium in the international markets as they are processed like regular conventional plastics but have zero carbon footprint, Bioplastics have a myriad of uses, including food packaging, beverage containers, disposable medical applications, and electrical applications to name a few.

Problem and Remedies towards Agri based Industrial Ecology in India

Unfortunately there are few artificially created road blocks that have stymied the off take of some of these examples of Industrial Ecology in India. These can be easily remedied with adequate awareness.

1. Since India lacks the downstream manufacturing startup to transform these ingredients into higher value, most of these intermediary ingredients lie un- monetized. At the very least, they can and should be exported till India encourages manufacturing start ups. The negotiations between farmer and the purchaser have remained adversarial. The author has proposed and modeled a novel and innovative agronomy pricing method that co-opts the farmer into the final pricing by giving him a percentage of the top line of the transformer of waste into HVAs. In this way, the farmers act as a co-operative and become active partners to the final product.

2. The total value of the Industrial Ecology in OECD countries is estimated to be around US$ 150Bn. per annum. It is a travesty that domestic funding agencies including VCs do not provide intervention capital to this sector mainly due to a misunderstanding or lack of awareness despite this massive economic opportunity. The effects of climate change and limited producers imply that prices will remain inelastic for some time. Indian entrepreneurs are now willing to provide intervention strategies that would monetize agrarian residue and bring small scale manufacturing in rural India. But this still only addresses a microscopic fraction of the demand gap that no country can fulfill. The benefit to rural farmers and emancipation of poverty by creating rural employment through novel schemes like Industrial Ecology from agri-residue is inestimable and cannot be put a value on. However, this is fact is not lost on International funders who unfortunately are not in India. Just as many in OECD countries are initiating a green manufacturing revolution, many such funders have a higher awareness and are seeking interventionist opportunities in India are also located in the OECD countries. The problem is not so much as “lack of funds” but “funder’s lack of awareness” that can facilitate intervention capital.  

3. Domestic industrialists need a general awareness campaign to educate them of the potential of India’s agri sector could provide them Industrial raw materials to replace their expensive imports. This may may behoove them to backward integrate to substitute their own imports.


Agri Residue has the potential to provide farmers, botanist and horticulturalists huge gains in marginal income from their existing farming practices. Broader definitions of crop diversification that fold in such innovations or interventions that provide a 'second harvest' to farmers should have a broader discourse.

If it is recognised that the definition of 'crop diversity' can be broadened to include the position the Author is proposing, an immediate task is would be to close the knowledge gap by curating India’s agri residues that can be assigned to industrial applications with a high bankable value. International investors that have an appetite and awareness of the opportunity and a track record into agri investing must be provided a tax agnostic exit option from India to facilitate entry that would kick start projects related to industrial ecology that matches their portfolio’s demands.


Brithal, P. S., Joshi, P. K., Roy, D. and Thorat, A. Diversification in Indian Agriculture towards High Value Crops: The role of Small Holders. Publisher- International Food Policy Research Institute, Washington-DC, USA, 2007.

Green, K. and Randles, S., eds. Industrial Ecology and Spaces of Innovation. Edward Eglar Publishing Limited, UK, 2006.

Kothari, A. Conserving Life: Implications of the Biodiversity Convention for India. Kalpavriksh, New Delhi, 1994.

Miyata, S., Minot, N. and Hu D. (2009). Impact of Contract Farming on Income: Linking Small Farmers Packers and Supermarkets in China. World Development, 37 (11): 1781-1790.

Mohanty, A.K., Misra, M. and Drzal, L. T., eds. Natural Fibres, Biopolymers and Biocomposites. Taylor and Francis, 2005.

Ramakrishnan, P. S. Agriculture and Sustainable Development: An Inerdisciplinary Study from Northeast India, Man and Biosphere Series. Vol.10. UNESCO and Parthenon Publishing Group, 1992.

Viswalingam, K., and Solomon, F. E. A. (2013) Process for Selective Extraction of Cardanol from Cashew Nut Shell Liquid (CNSL) and its Useful applications. International Journal of Scientific & Engineering Research 4 (3): 1-4.
*David James is the CEO of ChloroEarth® - Rebuilding With Nature©. Formerly an investment banker in the far east and London, he was risk manager in various capacities. He was also one of Asia’s pioneers to use weather and insurance derivatives as instruments to mitigate income loss due to the effects of climate change. On his return to India he embarked on his entrepreneurial journey to undertake grass roots development of Indian rural sector and at the same time address climate change using sustainable models. He has researched and piloted the use of several agri-residues fusing doctored native bio-polymers to take the industry beyond bio-composites and into bio-mimicry.

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