There is a revolution happening in Indian agriculture right now. Indian agriculture has come a long way to ensure the country’s food security and become one of the leading producers in the world. India is still largely an agrarian economy with 58% of the population dependent on agriculture. At present, agriculture and related industries contribute about 17-18% of the country’s GDP. The potential for growth in agriculture and related industries is enormous.
Today, the new buzzword in the Indian agricultural sector is agri-technology. According to data from Inc42, there are 1000 agri-tech start-ups in India in 2020 with over $400 million in funding raised from agri-tech start-ups between 2014 and 2020. According to the same research, The Indian agri-tech industry has the potential to reach around $24 billion in revenue by 2025. The current agri-tech penetration in India is only around 1%. Thus, the scope and potential of the market is huge. Agri-tech start-ups and D2C ventures in this space are disrupting the industry and ushering in a new era of Indian agriculture. It will also play a crucial role in the transformation of the agricultural sector and the food security of India’s growing population, which is expected to reach 1.6 billion by 2050.
The agro-tech boom
Agri-tech combines agriculture and technology. It refers to the use of technology and innovations in agriculture to increase yield, quality, efficiency and profitability. In recent times, the agro-tech revolution is being driven by advances in robotics, big data, AI, and other methods. India’s agri-tech industry is booming and solving the endless needs, problems and challenges of the Indian agricultural sector. Agri-tech start-ups are also solving problems related to animal husbandry, livestock management, poultry farming and dairy farming.
Innovations in the space address various industry issues such as finance, supply chain, agricultural challenges in extreme weather conditions, and the gap between supply and demand. Agri-ecosystem start-ups are now successfully harnessing modern technological advancements such as artificial intelligence, the Internet of Things [IoT]machine learning, big data and even blockchain to solve various problems, challenges related to gaps in market needs and transform the industry by enabling higher productivity, higher quality, better yield, traceability and increased profits for farmers.
How is agri-tech transforming Indian agriculture?
India’s agro-tech revolution is here. Driven by a host of new and advanced technologies, the agri-tech sector is transforming the Indian agricultural landscape.
Agri-tech start-ups can be subdivided into various sub-sectors such as: market linkages, agricultural inputs, precision agriculture, FaaS and financial services. Below, we take a look at how each of the sub-sectors are disrupting the culture landscape lately.
Link to market: Startups in this segment help farmers get more out of their yield by allowing them to partner directly with aggregators and sellers. No wonder farmers are rapidly adopting market linkage solutions in India. They are redefining the traditional supply chain model.
Agricultural inputs : Here, various data points help the farmer to produce a better yield and increase his productivity. Smart agricultural sensors enabled by the Internet of Things (IoT) help farmers collect data on soil quality, temperature, humidity, ammonia concentration and other variables. It can help them in real-time soil monitoring and provides data on moisture, temperature, electrical conductivity, soil ph and organic matter content. It is also essential in the livestock space to track the type of microenvironment available to livestock.
Precision farming: India’s agricultural productivity has always been below world standards due to poor farming practices. Now everything is changing thanks to precision farming. From understanding soil topography, weather forecasting to automated irrigation, precision agriculture approaches agriculture through innovation and adoption of various smart technologies. It provides farmers with farm-specific data on soil, topography, changing weather, pests and more using IoT sensors or geospatial technology and combining analytics to provide timely information. It makes farming more scientific and systematic and helps manage farming systems, often in real time.
Agriculture as a service: Farming-as-a-Service offers services such as on-demand machine rental, field leveling and pesticide spraying. It is the use of innovative enterprise-grade solutions for agricultural and related services using the pay-as-you-go or subscription model. Some solutions are organized and efficient reinventions of existing practices, while others are technological innovations.
Financial services: Finance is one of the crucial aspects that has plagued Indian farmers for decades. Start-ups in this sector are tackling issues such as lack of access to organized credit, collateral and high interest rates on loans to farmers. They provide farmers with more organized, safe and reliable financial service solutions through the use of technologies such as micropayments, secure banking systems, mobile banking, real-time market prices and remote monitoring.
Challenges and road ahead
India has pursued agricultural self-sufficiency since its independence. While achieving food sufficiency in production, India still faces challenges of resource-intensive agriculture and low farmer productivity, resulting in poverty and undernourishment. Other challenges plaguing the sectors are lack of infrastructure, supply chain inefficiencies, unorganized and fragmented nature of Indian agriculture and low digital adoption which are hampering the growth of the sector and impeding it. to function to its full potential.
To meet the challenges and harness the full potential of the sector, we need a three-point framework: infrastructure, innovation and investment.
In terms of infrastructure, we need to modernize our agricultural practices, adopt new technologies and prepare the future of digital agriculture. We need a better financial model so that farmers have better access to capital and resources and to make farming more organized.
Innovation is the backbone of the agri-tech boom in India today. The need of the hour is for innovative business models, disruptive business solutions that provide viable solutions for farmers. An incentive at the policy level to harness research and development in the agricultural space will help provide innovative solutions to modern challenges.
Investors are increasingly interested in the field of agri-tech. In addition to micro-credits to farmers at the local level, more investment in agro-technology will boost agriculture. In addition, intervention at the policy level to support agri-tech start-ups and the successful implementation at the local level of various programs for farmers will go a long way in boosting the sector.
(The author is co-founder, Eggoz Nutrition)