How Agritech startups are reorganizing agriculture in India -Sameer Bhanushali

Indian agriculture faces formidable challenges in the form of shrinking farmland in the face of a growing population, small and fragmented landholdings, poor quality seeds, lack of mechanization, lack of analysis and data, low yield per crop unit and dependence on middlemen.

Agriculture in India has not seen any major development since the green revolution of the 1960s. India is at an inflection point with an imminent agro-tech revolution that closely follows in the footsteps of ed-tech and of the end-tech.

Currently India holds the record of being the second largest agricultural land in the world. About 60% of rural households in India make a living from agriculture, which creates great potential for Agri-Tech start-ups in the country. Research shows that the total Agri-Tech market will be approx. $ 24 billion by 2025 when the current market is valued at $ 204 million, or about 1% of the global potential.

Current challenges of Indian agriculture

Indian agriculture faces formidable challenges in the form of shrinking farmland in the face of a growing population, small and fragmented landholdings, poor quality seeds, lack of mechanization, lack of analysis and data, low yield per crop unit and dependence on middlemen.

In addition, the absence of unified physical markets, inadequate transport and storage facilities, the existence of bad practices in unorganized agricultural markets, the scarcity of organized credit and the lack of visibility in terms of price, market , etc. are so many evils which paralyze the Indian agricultural sector.

The advanced technical know-how used in the world, the abundance of analysis and data, mechanized agriculture and superior R&D are currently lacking in the ecosystem,

How Agritech start-ups are revolutionizing Indian agriculture

Currently, there are 48 unicorn start-ups in India but none of them concern Agri-Tech. It is therefore a major growth opportunity.

Various Agri-Tech startups work in a variety of ways – from offering on-the-ground assistance at the micro level such as analyzing the soil of an agricultural farm specific to services at the macro level such as predicting environmental effects at the using satellite images. Agri-Tech actors are transforming the way agriculture is traditionally practiced at each stage of the value chain.

New Age Agri-Tech startups are focusing on digitally connecting physical markets through electronic marketplaces, where farmers and processors can sell their products India-wide without having a physical presence. They provide value-added services such as logistics, quality standardization and secure payments. They introduced technology to improve the traceability and sustainability of food in the agro-industry.

The agricultural inputs segment adopts and seamlessly combines technology with physical infrastructure to provide agricultural inputs at a better price. Precision agriculture and farm management companies help farmers improve their yields by up to 30 percent. Likewise, financial services actors serve around 30 percent of farm households through improved access to credit, and 65 percent of farm families through access to crop insurance.

The FaaS model is also becoming the future of agriculture. Farming-as-a-Service offers innovative solutions for agriculture and related services through a subscription or pay-as-you-go model. These solutions empower stakeholders to make effective data-driven decisions to help increase productivity and efficiency.

Government programs have been a catalyst in the rise of the agro-technological sector. The establishment of the National Center for Agricultural Management and Extension in Hyderabad (MANAGE) and the Department of Science and Technology have given tremendous impetus to the sector. The latter’s focus area was the acceleration of agro-tech start-ups by providing mentoring, industry networking and advice on investor pitching.

In 2020 alone, more than 20 agro-tech start-ups collectively raised more than Rs. 920 crore through subprime debt, equity and conventional debt rounds.

“AgriTech in India is at an inflection point and is seeing an increase in investment across the world. Our goal is to leverage technology to facilitate and support the very large, albeit archaic, agricultural commodity market, ”says Bilal Khimji, Director of Strategy at TradeBridge.

summary

Agriculture in India has so far not been part of the technological revolution, although it is an industry that provides jobs for almost half the country. However, we see the next decade dominated by Agri-Tech unicorns, which will lead to a tectonic shift in the agricultural ecosystem.

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