Leslin K Seemon
| 109 views | 4 min read
In India, where over half of the population depends on agriculture for its livelihood, the emergence of agritech startups is not a mere trend but a crucial pivot towards modernization and efficiency. The Indian agritech landscape, with its unique challenges and burgeoning opportunities, is on the verge of enabling real transformation for millions.
Agriculture in India is more than just an economic activity; it's a lifeline for over half a billion people. With a Gross Value Added (GVA) of $276.3 billion in FY20 and farming contributing 56% to this figure, the sector holds immense significance. That being said, Indian agriculture has historically grappled with issues like fragmented landholdings, low farm income, unorganized supply chains, and the impacts of climate change.
The agritech sector in India is poised to tackle these systemic challenges.
Key issues include:
Data Inadequacy: A lack of real-time data hinders technology adoption. Agritech solutions, utilising drones, IoT, and machine learning, aim to bridge this gap.
Quality Input Access: Farmers often struggle to access high-quality agricultural inputs. Digital platforms are increasingly facilitating the delivery of essential inputs.
Supply Chain Inefficiencies: India faces significant post-harvest losses, primarily due to poor transport and storage. Startups are addressing these issues through innovative supply chain solutions.
With over 1000 agritech startups, the Indian agritech market, valued at $204 million in 2020, is a fraction of the potential $24.1 billion market. This gap highlights the immense growth opportunity in this sector.
Market Linkage: Startups are creating platforms that connect farmers directly with markets, reducing intermediaries and wastage. ITC, a core outputs player, used its e-Choupal network to expand direct-from-farm procurement over the past 20 years.
Precision Agriculture: Leveraging data for effective farm management.
Farming-as-a-Service (FaaS): Offering machinery and equipment on a rental basis. Mahindra, for example, offers a tractor rental service
Financial Services: Enhancing financial inclusion through credit, insurance, and digital transactions. The State Bank of India (SBI) developed the YONO Krishi app to meet farmers’ finance, inputs, and advisory needs.
Emerging technologies are at the forefront of this revolution:
Digital Collars and Robotic Milkers: Enhancing livestock management and dairy productivity.
Agricultural Drones: Used for crop monitoring, soil assessment, and operational efficiency.
Automated Weeding: Employing smart vehicles for precision weeding.
Hydroponic Farming: Promoting soil-less farming with minimal water usage.
Recent farm reform bills, despite controversy, aim to open markets and potentially increase farm income. The government's commitment to technology in agriculture is evident in its allocation of INR 2,000 crore for the computerization of agricultural credit societies and the implementation of crop insurance policies like the Pradhan Mantri Fasal Bima Yojana.
The Indian government has taken several steps to foster technology and innovation in agriculture:
Farmer Collectivization: Promotion of farmer–producer organisations (FPOs) with a $750 million grant to set up over 10,000 FPOs in five years, aiding agtech companies like Samunnati in scaling their business models.
Development of the 'Agristack': Creating a unified agricultural database linked to farmers based on land holdings, enabling agtech companies to customise offerings.
Digital Soil-Health Cards: Mapping soil composition at the farmer level to promote precision farming.
National Agriculture Market (eNAM): An electronic trading portal connecting existing mandis, ensuring better prices for farmers through transparent auctions.
Agritech in India is still in its infancy with just 1% penetration of the addressable market potential of US$24 billion. As startups bridge gaps in data, supply chains, and market linkages, they are not just transforming the agricultural landscape but also enabling millions of farmers. This revolution, steeped in innovation and policy support, holds the potential to redefine Indian agriculture, making it more sustainable, efficient, and profitable.
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Recommended read : EY Report - Agritech
