Chem and Agriculture
Technology at farmer’s end
22 May 2023
India has traditionally been an agriculture dependent society. Even as late as 2011, ~55% of the total workforce was engaged in agriculture and allied sector activities (Census 2011). However, the sector has not been able to keep up with service sector and industry in terms of GDP growth. Its contribution to the GVA has more or less been constant at around 18% if we ignore the bump due to Covid. Though, one must mention that it provided the much needed support to the sinking economy during the COVID-19 pandemic.
There are several challenges this sector faces such as low yield, poor infrastructure, lack of credit availability, and climate change.The effects of these problems are more pronounced in the upstream value chain, especially at the farmer end. Several startups have emerged (but most of them are yet to break even) and funds (from private as well as public sector) have flown in.
One of the most significant developments in recent years has been the adoption of precision agriculture technologies. Precision agriculture is essentially a management strategy that gathers and analyses data using advanced tools and technologies to make informed decision in order to enhance productivity, quality and sustainability of agriculture. Several companies like CropIn, Farmwise and Aerobotics are providing farmers with these technologies.
CropIn is a SaaS-based agribusiness solution company founded in 2010. It has a network of 7M+ farmers. It recorded a revenue of INR 19Cr in FY21 growing at 33% CAGR over FY18-21. It gathers data from farms using drones and IoT, lending institutions, traders and satellites to provide farm management, risk and assessment, and traceability solutions to farmers, lending institutions, food processing companies and exporters.
Another area of technology adoption in Indian agriculture is the use of mobile apps for market linkages where farmers can sell their produce at prices competitive to APMC mandis at much greater convenience. Agribazaar, Bijak, DeHaat and WayCool are some such companies.
Agribazaar, started in 2017 by the promoters of StarAgri, is one of India’s leading startups in the agri output space in terms of GMV traded. It facilitates procurement from farmers, B2B trade between traders and processors as well as trade by NAFED and government bodies. It is one of the very few agritech startups with a positive EBITDA and a revenue of over INR 25Cr.
Another major area of concern that needs tech interruption is the availability of credit and other financial services like insurance for farmers. Lack of formal credit, high interest rates charged by informal lenders, complex processes, and delay in implementation of crop insurance schemes are the major challenges that can be addressed by the agri fintech startups. Players like Jai Kisan, Samunnati and Agriwise have come up with customized products addressing specific farmer needs and simplified application processes.
In conclusion, technology has the potential to transform the lives of farmers and help the government fulfil its promise of doubling farmers’ income through precision agriculture, market linkages using mobile apps, fintech and other technologies by reducing their costs, improving yield and productivity, and reducing wastages. While there are more challenges to overcome, continued investments from the private sector and comprehensive policy changes by the government can reform Indian agriculture and help unlock its full potential.

Author: Madhur Singhal, Managing Partner & CEO, Praxis Global Alliance

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