Agriculture has always been at the heart of the Indian economy. The bulk of the population is still dependent on agricultural activity to meet their basic needs. Even though there has been a digital boost amongst the farmer community present in the market, agricultural productivity is still low. Also, the proportion of agricultural employees in India is anticipated to fall to 25.7% by 2050. Furthermore, with high labor costs, a shortage of skilled workforce, and food security among the primary issues impeding agricultural output, farmers require a technological boost to match the rising demand.
Where other businesses are facing a funding winter amidst this economic crisis, the agritech market is anticipated to increase at a CAGR of almost 50%, hitting a $34 billion market by 2027 over the next five years, reveals a new report by Avendus Capital. This will only lead to the rise of agritech ecosystem in India. Here are the 3 major trends dominating the industry:
- Increased investments in Agri-tech: An EY report states that the Indian agritech market potential is expected to be around US$ 24 billion by 2025 According to Entrackr, between January 2020 and June 2022, about 100 agritech startups raised nearly $1.33 billion across 139 deals.
- Boost in Digital Literacy in Tier 2 & Tier 3 cities: In the last 5 years, smartphone penetration has soared by 150%, reaching 50% of rural households. This has helped to democratize the knowledge that can be used for agricultural management. Short-form video consumption has driven social media usage in rural India. The apps like MX Player, Snapchat, and Moj are ranked #2, #4, and #6 in terms of app downloads in India, respectively, according to Digital India 2022 (DataReportal).
- Farming-as-a-Service: Given the uncertainty around commodity prices and marketing, FaaS has been a lifesaver for marginal farmers and farm owners looking to cut fixed expenses and lower the need for collateral. As the cost of using a machine is split across multiple entities, they can rent rather than buy making it more affordable and accessible.
Indian agribusiness is surely getting a makeover and the focus is more on creating a better mobile experience for farmers by arming them with smart devices and digital tools to create a smooth mobile experience. The number of Agri-based Mobile applications has also shot up at a much faster rate. Industry behemoths have already ventured into the field to fill the existing gap in the market. Let’s look at some of the popular agri-based applications:
- ITC MAARS: FMCG conglomerate ITC launched a super app– ITC MAARS (Meta Market for Advanced Agricultural Rural Services) to boost farmers’ income and efficient procurement of Agri products by providing agricultural and related services to farmers on a digital platform. The phygital ecosystem gives farmers AI/ML-driven value-added personalized and hyperlocal crop advisories.
- A crop calendar for scientific planning of crop cycles,
- A ‘‘crop doctor’’ function for real-time resolution of infestation,
- Access to good quality inputs and market linkages,
- Real-time soil testing, and precision farming among others.
It will also onboard financial partners to provide loans and sell insurance. The app will allow the farmer to check the prices of the products in the nearest mandi and the option to sell them to ITC.
- Kisan AgriDoctor: AgroStar
A one-stop shop for all farmer needs, Kisan AgriDoctor has over 5 Lakh farmers on its Kisan agricultural Helpline app, which also happens to be the highest-rated farming-focused app in India.
- Samaadhan FaaS: EM3 AgriServices
Centered on providing technology and mechanization to the farming community on a Pay-for-Use basis to increase agricultural output.
- Through a network of farm hubs, the app provides a platform that enables technology to reach the farmer and the farm (Samadhan Kendras)
- Each unit is outfitted to handle a full range of fundamental and precision agricultural activities across the entire crop production cycle and is administered by IT-enabled technologies.
- GrainBank: Ergos
A technological platform that lets farmers transform their grains into tradable digital assets, get loans against those assets through associate NBFCs and Banks, and get better prices for their output.
The Way Forward:
Attracting farmers to the mix through a knowledge management portal and using it to engage with them has become an absolute necessity now. This platform could be a marketplace, a movie theatre, a medical device, or an upskilling venture in the hands of the group. It is a data mine of valuable information, providing insights into the behavior of one of the largest occupational sectors of the country. The other means could be a transparent ecosystem along with a mobile app with a smart interface that would help in making farmers’ journeys more transparent, trackable, and real-time in action.
Additionally, government initiatives such as an exclusive super app for farmers would educate them on post-harvest concerns including marketing, crop cultivation, and technology. It will also facilitate direct communication between farmers and the scientific community offering limitless possibilities and dramatically improving the experience for farmers, consumers, and organizations. Further, the recently announced agriculture-focused accelerator fund in the Budget 2023 would significantly strengthen the agritech ecosystem.
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