top of page

By:

Parashram Patil

14 January 2026 at 8:49:45 pm

The Winged Bio-Shield

The Indian swiftlet could help Konkan farmers reduce chemical costs, restore biodiversity and build a regenerative agricultural economy. The global agricultural matrix faces a dual crisis: escalating input costs and diminishing ecological returns driven by over-reliance on chemical interventions. In Maharashtra’s Konkan coastal belt, home to high-value horticultural assets such as the Alphonso mango (Hapus), cashew and coconut, this crisis demands a structural shift towards low-input,...

The Winged Bio-Shield

The Indian swiftlet could help Konkan farmers reduce chemical costs, restore biodiversity and build a regenerative agricultural economy. The global agricultural matrix faces a dual crisis: escalating input costs and diminishing ecological returns driven by over-reliance on chemical interventions. In Maharashtra’s Konkan coastal belt, home to high-value horticultural assets such as the Alphonso mango (Hapus), cashew and coconut, this crisis demands a structural shift towards low-input, high-efficiency biological systems. One promising approach is to integrate the Indian swiftlet (Aerodramus unicolor), a specialised insectivore, into agricultural pest management. By aligning its ecological behaviour with the principles of Natural Farming (Bhartiya Prakritik Krishi Paddhati), Konkan could reduce production costs, strengthen biodiversity conservation and build a regenerative agricultural economy. Konkan is a vital contributor to Maharashtra’s agrarian economy, but its high-value crop ecosystems remain vulnerable to fluctuating weather patterns and sudden pest outbreaks. The conventional response has been increased chemical pesticide use, with mounting economic and ecological costs. Synthetic chemical inputs can account for a substantial share of seasonal expenditure, squeezing smallholders’ margins. Pesticide residues can also complicate compliance with stringent Maximum Residue Limit (MRL) standards in export markets, while indiscriminate spraying harms native pollinators and can compromise fruit-set ratios. Reversing this trajectory requires a shift from chemical dependency towards biological pest management and the ecosystem services nature provides. Biological Asset The Indian swiftlet represents a potentially valuable biological asset. Unlike terrestrial birds, its physiology is adapted to continuous, high-velocity aerial foraging. It spends much of the day on the wing, catching insects in flight and covering substantial distances in search of food. From an agronomic perspective, a breeding colony could function as a decentralised bio-shield. The source proposal estimates that an individual swiftlet may consume 3,000 to 5,000 insects daily. On that basis, a hypothetical cluster of 20,000 birds could consume 60 million to 100 million insects a day. These estimates require scientific validation, particularly to establish how much of the birds’ diet consists of agricultural pests. Nevertheless, the possibility of sustained aerial insect predation merits investigation, especially during periods when orchard pest populations threaten valuable crops. By targeting insects in flight, swiftlets could potentially complement other biological controls and help suppress certain pests before they reproduce. Their contribution would depend on local feeding patterns, pest species and the extent to which their foraging overlaps with vulnerable orchards. Integrating swiftlets into agricultural policy could strengthen Natural Farming by addressing a vulnerability of ground-based interventions. Practices such as Jeevamrut application and mulching help nurture soil health and root zones, but do not necessarily protect upper canopies from flying insects. The swiftlet could provide an aerial complement to these practices, creating a more comprehensive ecological defence system without relying exclusively on labour-intensive natural pest-control preparations such as Agniastra. For Konkan’s small and marginal farmers, profitability often depends on controlling input costs. Conventional mango and cashew cultivation can involve considerable expenditure on pesticides and spraying labour. A swiftlet-assisted system could reduce some of these costs if field trials demonstrate effective pest suppression. The potential gains extend beyond farm finances. Reduced chemical spraying could limit workers’ exposure to hazardous substances, lower labour requirements and reduce the risk of crop losses associated with pest outbreaks. However, the scale of these benefits must be established through comparative trials rather than assumed in advance.
Biodiversity Dividend The integration of swiftlet habitats could create an economic incentive to conserve the wider coastal ecosystem, transforming conservation from a perceived burden into a productive asset. Reducing indiscriminate pesticide use would help protect beneficial insects, including native honeybees and butterflies, which play important roles in pollination. The extent of their recovery would depend on broader changes in pesticide practices and habitat quality, but a less chemically intensive landscape would provide a stronger foundation for biodiversity. The same logic applies to Konkan’s devrais, or sacred groves, and fragmented forest patches. These landscapes support diverse ecological communities and provide important habitats. If farmers recognise surrounding forests as part of the natural infrastructure supporting their orchards, community-led conservation could acquire a stronger economic rationale. Reduced chemical contamination could also benefit other regional wildlife, including the Malabar pied hornbill. Maharashtra has a potential biological starting point in the Vengurla Rocks off the Sindhudurg coast, associated with significant Indian swiftlet populations. The next step would be to investigate whether carefully designed inland habitats could attract breeding populations and support agricultural pest management. Parts of Southeast Asia, particularly Malaysia and Indonesia, have developed specialised swiftlet houses modelled on natural caves. These structures, sometimes equipped with acoustic playbacks, attract birds for the commercial production of edible nests. A comparable model could offer rural communities a potential second source of income alongside horticulture. But the transferability of Southeast Asian practices to inland Konkan cannot be assumed. Local climate, habitat, colonisation rates, construction costs and the birds’ ecological requirements would all need careful assessment. The Indian swiftlet’s conservation status and the applicable provisions of the Wildlife (Protection) Act, 1972, must be examined before any capture, harvesting or commercial activity is considered. Conservation must remain central to any economic model. To explore this opportunity, Maharashtra could develop a Public-Private-Community Partnership involving the Forest Department, agricultural researchers and local farmers. Three priorities deserve attention. First, scientific research must establish the swiftlet’s diet, foraging patterns and actual impact on orchard pests. Second, pilot projects should compare conventional cultivation with swiftlet-assisted natural farming, measuring pesticide use, production costs, yields, fruit quality and biodiversity. Third, any proposed nesting structures or commercial activities must comply with wildlife laws. The institutional integration of the Indian swiftlet into Konkan’s agricultural framework offers a potentially valuable synthesis of ecological regeneration and farm economics. By treating the bird not merely as a protected wildlife species but also as a possible partner in biological pest management, Maharashtra could explore a new approach to sustainable horticulture. (The writer is a member of Maharashtra Agriculture Price Commission. Views personal.)

UPI Was Free. What Happens When It Isn’t?

Writer: Archita Gaur
Archita Gaur
6 hours ago
5 min read

For millions of Indians, paying through UPI has become almost invisible. Scan a QR code, enter a PIN, and the transaction is done usually without anyone asking what it costs to make that payment possible. That near-zero-cost experience has been central to UPI’s rapid adoption.


Now, the proposed introduction of charges on certain UPI transactions marks a shift in the economics of India’s digital payments ecosystem. While consumers are not being asked to pay a fee for ordinary UPI payments, the changing fee structure raises a larger question: who ultimately pays for the infrastructure behind India’s favourite payment system?


The proposed merchant discount rate (MDR) of 0.4 per cent on specified merchant transactions above Rs. 2,000 was originally scheduled to take effect on October 15, 2026. However, reports of a possible postponement to January 2027 have introduced uncertainty about the rollout.


Model Reconsidered

UPI transactions have operated under a model that prioritised adoption over direct revenue. Unlike card payments, where merchants typically pay an MDR, UPI transactions have largely carried no MDR for merchants. The government has supported the ecosystem through incentives to banks and payment service providers, helping keep digital payments inexpensive and widely accessible.


Under the announced framework, a 0.4 per cent MDR would apply to specified person-to-merchant transactions above Rs. 2,000, with exemptions for eligible small merchants and special rates for certain categories. The maximum charge would be capped at Rs. 300 for transactions of Rs. 75,000 and above. Person-to-person transfers would remain free, as would transactions covered by the zero-MDR framework.


The government has said that approximately 96 per cent of person-to-merchant transactions would remain unaffected.


Yet even a small fee matters when applied to an enormous transaction base. UPI processed 2,366 crore transactions worth Rs. 29.9 lakh crore in July 2026 alone, according to the Finance Ministry. At such scale, a fraction of a percentage point can generate substantial revenue.


As UPI moves from being a tool for driving digital adoption to becoming critical financial infrastructure, the question of who should pay for its operation - and how much - is becoming increasingly difficult to avoid.

Keeping UPI transactions free was never simply about making payments cheaper. It was also a policy choice designed to accelerate India’s transition towards a digital payments economy. By removing transaction costs for merchants and consumers, UPI lowered the barriers to adoption, including for small retailers and informal businesses that had traditionally relied on cash.


Its convenience, interoperability and low cost helped it move beyond urban, tech-savvy consumers and become part of everyday transactions across the country.


UPI also altered the relationship between banks, customers and businesses. Payments that once required cash handling, change, physical visits or card infrastructure could now be completed through a common digital interface.


But banks and payment companies still bear the costs of processing transactions, maintaining infrastructure and preventing fraud. They must also manage failed payments, customer complaints, system outages and increasingly sophisticated cyber threats. Meanwhile, merchants have become accustomed to accepting UPI without an explicit transaction fee.


The government’s incentive schemes have helped compensate ecosystem participants for some of these costs, particularly in promoting low-value payments. But public subsidies have their own opportunity cost, and their continuation cannot simply be assumed indefinitely. As volumes grow, the question is whether an ecosystem built around free transactions can remain viable without a more durable revenue model.


Major Misconceptions

The biggest misconception surrounding “paid UPI” is that the cost will necessarily fall directly on consumers. In reality, the economics are more complicated. When a merchant-side charge is introduced, the immediate liability falls on businesses and payment ecosystem participants involved in processing the transaction. But businesses rarely view costs in isolation. Over time, additional expenses can influence pricing, margins and the payment methods they choose to encourage.


Consider a merchant receiving Rs. 10,000 through a transaction covered by the proposed 0.4 per cent rate. The MDR would amount to Rs. 40 before applicable taxes or other contractual considerations. That is not an enormous sum in isolation. Across hundreds of transactions, however, the accumulated expense becomes more consequential.


Merchants may respond in different ways. Some could absorb the charge as a cost of doing business; others might adjust prices, promote alternative payment methods or encourage customers to use cash for larger purchases. The government has said that charges should not be passed on directly to consumers, but preventing an explicit surcharge is not the same as preventing every indirect effect on prices.


There is also a question of how the revenue is distributed. MDR is not a tax collected by the government; it is intended to compensate participants in the payment ecosystem. Banks, payment service providers and technology platforms all have roles in enabling transactions, but their respective contributions and bargaining power differ. A fee intended to support the entire ecosystem could have uneven effects if a disproportionate share accrues to a handful of dominant players.


The challenge is therefore is to ensure that the money sustains the infrastructure on which UPI depends, rather than simply rewarding scale and market dominance.


For consumers, the immediate impact of the proposed charges may be smaller than the phrase “paid UPI” suggests. Ordinary users are not being asked to pay a fee every time they scan a QR code. Person-to-person transfers and the vast majority of routine merchant transactions are expected to remain unaffected.


But if merchants begin factoring payment costs into their margins, consumers could eventually face higher prices or be encouraged to use certain payment methods over others.


There is also a broader question of trust. UPI’s appeal rests partly on its simplicity. Consumers have little reason to think about the banks, networks and technology providers behind the interface. Introducing charges into the merchant-side ecosystem could make those invisible arrangements more visible, particularly if customers encounter inconsistent practices across businesses.


The distinction between the formal rule and the experience at the counter will matter. If a merchant tells a customer that a larger UPI payment attracts an additional fee, the customer may reasonably assume that UPI itself has become chargeable. Clear communication and effective grievance redressal will therefore be essential.


The key question is not whether Indians will suddenly stop using UPI, but whether changes to its cost structure could gradually alter the habits that made it dominant. Convenience is a powerful advantage, but it should not be treated as an unlimited licence to increase costs without explaining who benefits and why.


The debate over UPI charges ultimately points to a larger policy dilemma: how can India maintain an affordable digital payment system while ensuring that the ecosystem behind it remains financially sustainable?


Keeping transactions free has helped UPI achieve extraordinary scale, but payment infrastructure is not costless. Banks and payment providers must continuously invest in technology, cybersecurity, fraud prevention and network capacity. A system that processes billions of transactions cannot depend indefinitely on the assumption that its operating costs will somehow take care of themselves.


At the same time, making digital payments significantly more expensive could undermine one of UPI’s greatest strengths: accessibility. India’s digital payments story has been built not only on technological innovation, but also on the ability of a small merchant and an ordinary consumer to transact without worrying about payment fees.


The answer may lie in a carefully calibrated model rather than an absolute choice between free payments and commercial pricing. Any fee structure should be transparent and designed to protect low-value transactions and vulnerable users. Policymakers must also examine whether the costs are being allocated fairly among banks, payment platforms and merchants, and whether public incentives remain necessary for particular segments of the ecosystem.


UPI may not remain entirely free for every category of transaction. But its long-term success will depend on preserving the principle that made it transformative, namely that digital payments should be accessible and inexpensive enough to become an ordinary part of economic life.


 (The writer is an economics postgraduate from Jawaharlal Nehru University with research interests in economic policy, trade and global governance. Views personal.)

Comments

bottom of page