Extreme weather events aside, changes in temperature and rainfall are already being acutely felt amongst Indian people, especially farmers. Agriculture is still a major source of income, accounting for about 14% of the country’s GDP and employing close to 800 million people. The sector is desperately dependent on the monsoon, as the majority of farmland does not have access to irrigation. Yet monsoons are erratic, increasingly so because of climate change. When they fail, crops fail, food prices soar, reservoirs empty and farmers’ livelihoods are crushed.
Changes in agricultural productivity patterns, along with the impacts of heatwaves, floods and rising sea levels could reduce average living standards in India through diverse pathways, such as agricultural and labour productivity, health, migration, and other factors that can affect domestic consumption, economic growth and poverty reduction. We would expect companies to have already started to factor these adaptation challenges into their business strategies. In fact, we would argue it is imperative for them to thrive in the long term.
We spoke about challenges to agricultural productivity with two fast-moving consumer goods companies that are heavily reliant on agricultural raw materials – Marico and Hindustan Unilever (HUL).
Marico is one of India’s leading personal care products manufacturers and the largest buyer of coconuts in the country. We were encouraged to learn about the company’s actions to manage climate risks in its coconut supply chain. These include partnerships with research institutions to developed improved, drought-resistant crop varieties, and cooperation with selected farmers to promote science-based practices on nutrients, disease and water management. We also met with HUL, who run similar sustainable agriculture programmes with their tomato suppliers.
By improving crop yields and soil health and, ultimately, boosting farmers’ livelihoods, these programmes are critical to building supply chains that are more resilient to anticipated changes in precipitation and temperature patterns across India. Going forward, we will encourage both companies to extend the scope of their programmes to cover more farmers, and engage with authorities and other relevant stakeholders to promote the adoption of more sustainable soil and water management practices.