Digitization in Indian Agriculture Sector

As the world is pacing towards a digital economy due to the pandemic, it was only a matter of time for the agricultural sector to start integrating the digitization aspect into its own system. Currently valued at US$ 370bn, the agricultural sector is one of the vital sectors of the Indian economy. In recent times, the focus of this sector pivoted around strengthening incomes of the farmers, who account to more than half of the Indian population and depend on farming as their primary source of income. India is already a chief manufacturer of commodities such as spices, fish, poultry, livestock and plantation crops. Globally, it stands first in the production of jute, milk and pulses and second in production of fruits, cotton, vegetables, rice, groundnut and wheat. Digitization is one useful way to enhance the earnings of the farmers and stimulate the overall performance of the agricultural production mechanism.

Start-ups emerging as players:

According to a report by NASSCOM, the Indian Government with its ‘Start-up India Programme’ categorically assists AgriTech start-ups, which are clearly leading India’s next Green Revolution. The agricultural industry contributed roughly 19.9% of total GDP in FY21, increasing from 17.8% in FY20. The Indian AgriTech market nearly contains 600-700 start-ups of which five promising AgriTech start-ups helping Indian farmers are:

1. Ninjacart: raised $164.2 mn in FY21
2. WayCool: raised $60.8 mn in FY21
3. AgroStar: raised $42 mn in FY21
4. DeHaat: raised $19.3 mn in FY21
5. Bijak: raised $14.3 mn in FY21

Indigram Labs, a Technology Business Incubator aims to incubate 100 AgriTech entrepreneurs over the next five years. By FY25, the market is anticipated to grow at a CAGR of 32.0% in terms of revenue.

Application of Digitization Tools in Agriculture Sector:

• Responsible administration and monitoring of farmland
• Avoids usage of surfeit pesticides, fertilizers and lowers overall water utilization
• Expands agricultural productivity and minimizes expenditure
• Hinders soil degradation
• Raise socio-economic status of farmers
• Enhance safety at work
• Reduce environmental and ecological aftermath

Today, numerous digital technologies have come up shaping the agricultural value chains and rejuvenating operations by enabling farmers maximise their output. Remote sensing, soil sensors, unmanned aerial surveying and market insights, etc., not only help farmers collect, envisage and evaluate crop and soil health conditions at different stages of production, but also provide an early signal to identify the challenges and deal with them in a timely manner. Artificial Intelligence/ Machine Learning (AI/ML) algorithms can generate real-time actionable insights to help improve crop yield, control pests, assist in soil screening, provide actionable data for farmers and reduce their workload. Blockchain technology offers tamper-proof and precise data about farms, inventories, quick and secure transactions and food tracking, so that farmers don’t have to be dependent on paperwork to record important data. Projects based on technologies such as data analytics, big data, satellite imaging, IoT, GIS technology and use of drones and robots are also proving to be successful.

Initiatives under Digital Agriculture Segment in India:

The need for digitization has become a national interest and hence necessary initiatives are also taken towards the same.

1. Digital Agriculture Mission 2021-25 (2021)
2. The Jio Agri (JioKrishi) platform (2020)
3. Agricultural Digital Infrastructure (ADI) solution (2019)
4. National Agriculture Market (eNAM) (2016)
5. Soil Health Card Scheme (2015)
6. Direct Benefit Transfer (DBT) Central Agri Portal (2013)

The Indian Government has introduced Digital India, a platform to provide the farmers of India in urban and rural areas, various government services electronically through digitally enabled devices. It has proven to be a boon for Indian agriculture. Other initiatives like E-sagu, Community Radio (CR) and digital green are also considered to be brilliant initiatives.

The Future:

• The distinct small-holder farms in the country make the process of data gathering complex. Farmer Producer Organisation (FPOs), a group of small farmers should be formed so that even if they individually have less than 2 hectares of landholding but when they unite, they may have hundreds of hectares and implementing technology becomes a feasible option.
• Limited penetration of mechanisation tools and recurring adversities like drought, floods and excessive monsoon, have negatively impacted the deployment of digital solutions in the sector. Customisation is the need of hour and should be implemented to each Indian farm.
• Low-cost technology and equipment rental services are required. As typical Indian farmers are small, plug and play hardware has good opportunities in Indian market.
• The government should take steps to educate the farmers, take time-to-time feedbacks to understand whether the projects are proving to be helpful for them and encourage them to share ideas and suggestions so that better facilities can be provided.

While many countries have already taken huge benefits from these modern solutions, we at ‘Untapped Markets’ believe that acceptance in India is still at a very nascent stage but it will enhance sustainability, accelerate growth and revolutionise agriculture in the coming few years. Yes, there are a plenty of obstacles but when there are challenges, there are opportunities to be delved into as well.