An Assessment Of Indian Agri-tech Market : Daily Current Affairs

Relevance: GS3: Agricultural produce, issues and related constraints

Key phrases: Agriculture Infrastructure Fund (AIF), Supply chain management, Post harvest value addition, agritech market, Ken Research report, Big data analytics, Ninjacart and Crofarm, B2F (business-to-farmer) and F2B(farmer to businesses)models, Agri-Startups

Why in News ?

A recent study by EY found that the Indian agritech market potential is at $24 billion by 2025, of which, only 1 per cent has been achieved so far.
Beside this, among various agritech segments, the supply chain technology and output markets have the highest potential, worth $12.1 billion.
Now, agriculture is in the age of new revolution, at the heart of this revolution lies data and connectivity.

Facts

Agriculture sector contributes 16 per cent to the GDP and employs more than 45 per cent of the workforce.
According to Agfunder, India witnessed an increase in funding from $619 million in H1 2020 to $2 billion in H1 2021, however this is significantly lesser than what the US ($9.5 billion) and China ($4.5 billion).
According to a Ken Research report,
- The Indian Agritech market was expected to grow at a CAGR (revenue) of 32 percent from FY20 to FY25.
- Karnataka, Maharashtra and Delhi-NCR had the most number of Agri-tech start-ups in the country.
- It is estimated that $10bn will be invested in Indian Agri-tech start-ups over the next 10 years.
According to a recent NASSCOM Report, yearly growth of agritech startups in India has been at a rate of 25%.
India is home to more than 450 startups in the agriculture technology sector, of the global total of about 3,100.

Need for Agri-tech

India facing post harvest losses amounting to Rs 93,000 crore, agritech startups can address this issue with demand driven cold chains, warehouse monitoring solutions and market linkages that can significantly boost farmer income.
Agri-tech uses artificial Intelligence and remote sensing to improve land management, crop cycle monitoring, harvest traceability, and increase crop productivity by using big data analytics.
Advances through new agritech machinery have expanded the scale, speed, and productivity of farm equipment, leading to more efficient cultivation of larger land parcels. Seed, irrigation, and fertilisers also have vastly improved, helping farmers increase yields.
Robotics, Drones use, analytics, connected sensors, and other emerging technologies could further increase crop surveillance, improve the efficiency of water and other inputs, and build sustainability and resilience across crop cultivation and animal husbandry.
Agritech startups such as Ninjacart and Crofarm are creating direct market linkages through digital platforms.

Issues

It is estimated that there are about 500 agritech start-ups in India, operating at various levels of supply chains. Almost all of them would have benefited from the new farm laws which have now been repealed, threatening the risk of poor growth to these start-ups.
Through the use of artificial intelligence, machine learning, internet of things (IoT), these start-ups connecting farmers, small operators such as kirana shops, ,mom-and-pop stores, the delivery start-ups and ultimately the consumer under one umbrella, are facing issues of investment crunch and regulatory cholesterol.
Through these start-ups, farmers are also able to directly connect to bigger players who buy quality produce in bulk. Since, Indian farmers are not as technologically advanced as their Western counterparts. Also, tech penetration in the rural landscape is not widespread enough.

Case studies of two successful Agri start-ups

Dehaati Beej Se Baazar Tak

It analyzes a full-stack agri-service that engages firms through B2F (business-to-farmer) and F2B(farmer to businesses)models. It uses data science, agriscience and analytics to nurture an ecosystem of farmers, micro-entrepreneurs and institutional buyers.
With a total funding of $162 million since June 2014, Dehaat raised $115 million in October 2021 alone; this is reported to be one of the biggest fundings in the agri-tech space.
Dehaat is present in Bihar, West Bengal, Odisha, and Uttar Pradesh, and is working with 6,50,000 farmers through 1,890 centres.

Ninjacart

It sources fresh produce from farms and supplies to retailers, restaurants, grocery and kirana stores, and small businesses and is operational in around a dozen cities.
It claims to have reduced wastage to 4 per cent compared to up to 25 per cent in traditional chains through a demand-driven harvest schedule.

Way Forward

For promoting Agri-Startups, there is a need to clear roadblocks and bring policy certainty after repeal of Farm Laws.
Need to fill infrastructure gaps especially in rural areas, promote digital literacy and help people become more knowledgeable about the digital world.
Integration with School Curriculum,this can have a favourable impact on the start-up ecosystem in India, if entrepreneurial skills are integrated with the education curriculum under new education policy.
Post covid biggest takeaway for every sector — is adapting to the new normal. And this ‘new normal’ is almost entirely technology driven, and farming is no exception ,it must embrace a digital, connectivity-fuelled transformation in order to bring quality and connect directly with the consumer without any middlemen.

Mains Question:

Q. What do you mean Agriculture Extension Services? Despite its significance in agriculture modernisation and reducing prevailing agriculture distress, the progress made in adoption of Agriculture extension services is very unimpressive. Discuss. ( 15 marks)

Source: The Hindu BL