Here’s how Digital Public Infrastructure (DPI) reforms will revolutionise stock market

The finance minister recently announced the implementation of Digital Public Infrastructure (DPI) in agriculture to cover farmers and their lands. This initiative is a part of the broader Digital India campaign, which is built on the foundation laid by the National Land Record Modernization Programme (NLRMP), now known as the Digital India Land Records Modernization Programme (DILRMP). DILRMP aims to modernize land record management, minimize disputes, and enhance transparency.

Revolutionizing Land Management

The digitization of agricultural lands under DPI will allow the government to maintain comprehensive and accurate records of farming land across the country. This will include land-wise information on crops, which is crucial for managing the steady demand and supply of agricultural products. By enhancing the accuracy and transparency of land records, DPI will significantly reduce land disputes and facilitate easier access to land-related information on a single click.

Key components of this initiative include the digitization of land records, cadastral maps, and the updating of all settlement records through surveys and resurvey. Each land will receive a Unique Land Parcel Identification Number (ULPIN) or Bhu-Aadhaar, and urban land records will be digitized using GIS mapping. Additionally, the DPI will include the JanSamarth Kisan Credit Card, which will provide farmers credit for farming purposes as short-term credit for crop cultivation or as a working capital need at a lower rate of interest.

Impact DPI Introduction on the Stock Market

The introduction of DPI for agriculture is set to have wide-ranging effects on various sectors of the stock market. Here’s a closer look at how different sectors and companies will benefit:

1. Boosted Efficiency and Growth for Agriculture-Based Enterprises

DPI will allow agriculture-based companies to optimize logistics, supply chain management, and resource allocation. With precise data on crop readiness and harvest times, companies can streamline operations, reducing wastage and improving efficiency. This access to comprehensive agricultural data will drive innovation in product development and at service delivery. Companies will be able to develop tailored products that meet the specific needs of farmers, expanding their market reach and revenue potential. These advancements will likely lead to higher profitability valuations for agriculture-based companies as innovation.

2. Advantage to Lending Institutions

The issuance of JanSamarth Kisan Credit Cards to farmers will improve their access to credit and insurance by providing accurate land and yield records. Financial institutions will be able to assess creditworthiness more effectively, reducing defaults and enhancing financial stability. Digital land records may streamline the process of using land as collateral for loans, improving farmers' access to credit. This increased investment in farming can surge the advances of the banking and financial services sector companies. Moreover, enhanced access to credit can also benefit microfinance institutions (MFIs) and non-banking financial companies (NBFCs) which usually cater to rural areas.
The digitization of agricultural lands under DPI will allow the government to maintain comprehensive and accurate records of farming land across the country.

3. Technological Advancements and Opportunities to IT Companies

DPI’s introduction of IT infrastructure into agriculture will foster partnerships between IT companies and agricultural organizations, as well as government bodies. These collaborations will drive the development of innovative solutions and facilitate the exchange of expertise and resources. The demand for digital platforms, cloud computing, and cybersecurity solutions will drive business growth and innovation in the IT industry. This will open new markets and revenue streams for IT companies, enhancing their market position and stock valuations.

Conclusion

The recent announcement of Digital Public Infrastructure (DPI) for agriculture marks a transformative step for the various sectors, with significant impacts on agricultural productivity, efficiency, and sustainability. Agriculture-based companies and related sectors are likely to see improved performance and increased market valuations, driven by the transparency, efficiency, and competitiveness brought about by DPI. This reform not only modernizes land management but also creates vast opportunities across multiple sectors, promising substantial benefits for the stock market and the economy at large.

Technical Outlook:

ETMarkets.com

Nifty experienced a volatile week following the budget presented last Tuesday, ending at 24,835, up 1.24% for the week. The index once again surpassed the 10-day moving average, with the daily RSI recovering from lower levels to settle at 70. Nifty’s primary trend remains positive, following higher highs and higher lows. The strong support remains at 24,450, while 25,000 serves as an immediate hurdle; a breakout above this level could extend the rally toward the 25,250-25,350 zone.

The global market remains neutral whereas the domestic market appears stretched. India VIX currently stands at 12.25 and remains below the 15 mark, there would be a mixed outlook. Overall, Nifty is anticipated to trade sideways with a positive bias.