The Indian government has extended $50,000 worth of assistance to the Philippines' corn sector and has even initiated a bilateral exchange on agricultural technology with the Philippine government.

During the general membership meeting of the Philippine Chamber of Agriculture and Food Inc. (PCAFI), Indian Ambassador to the Philippines Shambhu S. Kumaran has proposed a bilateral exchange with the Philippines involving agricultural technology and financial technology.

He also said the Indian government has already touched base with Philippines’ Finance Secretary Carlos Dominguez III for a possible agritech and fintech exchange.

“An Indian company allows banks to use geospatial data, satellite data to make informed lending decision. You have the software, the tool which gets all data in a region. It allows banks to cut the risk and understand where and when credit dispersal is viable. They will have constant stream of data,” Kumaran said.

“We offer to Philippines the possibility that DBP could have this tool without having to procure it. It will be free-of-charge. The revenue model allows that the creditors and software companies, all have the benefit from using the technology,” he added.

Despite the Agri-Agra Law, local banks remained hesitant to lend to the agriculture sector as they don’t have mitigation strategies and risk assessment tools to determine what viable business to fund.

Meanwhile, the possible replication of an Indian financing system called Viability Gap Fund (VGP) has also been proposed by the Philippine Maize Federation Inc. (PMFI) President Roger Navarro, who was also present in the PCAFI meeting.

The VGP was put up in India to fund viable projects by unviable proponents or the meaning small and medium farmers.

Navarro said that the fund may come from the Agri-Agra Law, which required banks to lend 10 or 15 percent of their loanable amount to the agriculture sector and agrarian reform.

As of 2019, given compliance of all banks, this agri-agra law fund would have been P1.384 trillion, according to the Department of Agriculture (DA).

Kumaran then affirmed the need for the VGF in the country.

“We should have smart public policies. Food security is an absolute non-negotiable. We have lots of small and marginalized farmers in India. They find it hard to access common assets, so the government needs to come in,” he said.

Kumaran said the bilateral meeting will have technical engagements, presentations, and contact building. It will create platforms for conversation between two countries.

PCAFI agreed to co-organize the bilateral meeting with Indian Embassy sometime this year.