Home Latest News How the Growing Agritech Boom Bodes Well For India’s Agriculture Economy

How the Growing Agritech Boom Bodes Well For India’s Agriculture Economy

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Increased awareness of technology among the farming community, and the government’s push towards creating incubators and awarding grants, among other factors, are accelerating the adoption of agritech but problems such as fragmented supply chains and wastage of produce due to lack of storage facilities pose a challenge.

A hand is holding a smartphone with infographics on the background of a carrot plantation. Agriculture. innovative technologies, data analyzing on plants status. Vegetable rows. Organic. agriculture.

India’s agritech ecosystem is one of the fastest growing in the world. The country is home to the third-largest number of agritech start-ups, and we are also the third-largest recipient of agritech funding, right behind the United States and Germany. In fact, in 2020, India garnered investments worth US$ 329 million from private equity and venture capitalist firms. The sector also registered a whopping CAGR of ~53% from US$ 91 million in 2017 to US$ 329 million in 2020. And this is just the tip of the iceberg; even with these impressive numbers, India’s agritech sector is yet under 1% of its true market potential. This means that the scope for growth and innovation is limitless, and the pandemic has acted as one of the biggest catalysts for the agritech sector to boom. 

In addition to the pandemic having accelerated the timeline for the adoption of agritech, there are a myriad other factors that have led to the sector’s rise. Most importantly, this paradigm shift has been driven by the penetration of high speed internet across urban, semi-urban and rural areas. Increased awareness of technology among the farming community, and the government’s push towards creating incubators and awarding grants has also helped. 

Despite all of this progress and the government’s best efforts, massive pain points continue to linger across India’s agricultural sector. Problems such as fragmented supply chains and wastage of produce due to lack of storage facilities still lead to thousands of Indians going hungry everyday.  This is where agritech companies can step in and assist traditional farming ecosystems to transform into efficient and prosperous communities.

How is Tech Driving the New-age Agri Revolution in India

There are a host of new and cutting edge technologies that are being leveraged by the agritech sector to bring about change in India’s farming landscape. Below are a few examples of which technology is driving what change. 

Precision farming via drones and satellites: This is a concept that is helping farmers to improve crop yields, optimise soil quality and productivity through a series of tech interventions. For example, accurate weather alerts are generated with the help of best-in-class satellite imagery that easily cover large tracts of land. Meanwhile, drone imagery helps to scan crops for diseases or infestations, and they can also generate precise terrain maps. 

IoT Sensors: IoT sensors are highly sensitive devices that detect and respond to changes in the environment. Through them, farmers can get accurate and real-time information about soil temperatures, weather patterns, humidity and air quality. This helps farmers to plan better and not be caught off guard by freak weather events that are becoming increasingly common due to climate change. 

Finance: For the longest time, India’s agriculture sector was state controlled and farmers had little access to formal credit. This led thousands of farming families into a vicious cycle of debt that was perpetuated by unscrupulous money lenders. Although this problem still persists for scores of marginal farmers, the digital economy has brought in much needed change in farming finance systems. Scores of agritech startups are offering digital-led agri banking services to traditionally underserved communities. From alternative credit scoring to digital crop loans, and helping farmers to calculate crop insurance and loan risk, agritech companies are working to use digital finance technology to help farmers get access to sustainable and hassle-free financing. 

Blockchain: Consumers today have high expectations when it comes to food quality and the origin of products. They rely on certifying agencies to verify if a product is genuine and reliable. However, there are glaring gaps when it comes to the traceability of organic produce and a wide margin for fraud. Blockchain has the capability to speed up food traceability and help consumers to easily track when and where their produce originated. For example, a QR code that is a two-dimensional barcode with much larger data capacity than a one-dimensional barcode, can deliver excellent results to traceability.  With a simple barcode scan consumers can know how the produce was grown and transported to a POS. Blockchain can thus become the single largest enabler of the farm to fork concept in the agri economy. 

Machine Learning: This year, the Indian government struck a deal with three major tech giants — Amazon, Microsoft and Cisco Systems — to harness data and statistics available on India’s agricultural ecosystem since 2014. The collaboration is meant to increase the use of AI and ML models in India’s agricultural economy. With the help of novel neural network algorithms, agritech startups can create valuable insights about expected future trends of agricultural commodities. Such commodity trend predictions can help millions of farmers to reduce risks and increase profits. 

It is estimated that by 2050, approximately nine billion people will require food. And India has the opportunity to become ‘the food bowl of the world’. Agriculture is the backbone of the Indian economy and with the help of agritechs that are ready to solve industry challenges; the country can harness its true potential. 

The writer is Founder, GreenSat Innovation Labs Pvt. Ltd, an agri-tech satellite imagery data analytics company serving the precision farming and risk mitigation needs of farmers.