Role of Agritech in Transforming the India’s Agriculture Sector

General Studies Paper-3

Context: The Government of India has been increasingly adapting to the ongoing innovations and changes in the agricultural sector to keep up with the pace at which the sector is developing globally.

About AgriTech

• It is a term used for agricultural technology, which involves the use of technology to improve farming and agriculture across different value chains.
• It includes sophisticated technologies that drive the so-called ‘fourth agricultural revolution,’ akin to the industrial 4.0 revolution, shaping the future of the sector.

Status In India

• In India, AgriTech has continued to grow with startups using innovation and digital technologies like precision farming, quality management, production, supply- chain/market linkage, and digital traceability to name a few.
• The Agritech industry has experienced a remarkable tenfold growth in the past three years, propelled by four pivotal factors:
  • The expanding digital reach throughout India, supply chain disruptions due to COVID,
  • Rising consumer demand for high-quality produce, and
  • Growing interest from private equity and venture capital.
• Currently, there are nearly 2800[Startup India Database as on 31st December 2023] AgriTech startups recognised by Startup India.
• The Economic Survey of India 2022-23 highlighted that India’s agriculture sector has grown 4.6 per cent over the last six years with over 1000 agri-tech start-ups having emerged in the sector.

Need and Importance

• With over 70% of India’s rural population still being dependent on agriculture for their livelihood, the need for innovation in the sector has always remained high.
• Satellite data has given Indian farmer optimal sowing times, weather warnings, and better use of irrigation and pesticide
• The positive impact of AgriTech is not only evident in increased productivity and income for farmers but also in the potential to reshape the entire agricultural landscape of India for the better.
• Steps
• Indian Finance Minister Nirmala Sitharaman, in her 2023 budget speech, announced a 703 million rupee ($8.42 million) accelerator fund to boost agritech startups.
  • In March 2023, the government said the fund was supporting 1,138 such companies.
• The Digital Agriculture Mission (DAM) initiative was launched in September 2021 to help agri-tech start-ups by leveraging advances in cloud computing, earth observation, remote sensing, data, and AI/ML models.
• National Agricultural Market (e-AM) scheme offers free software as well as financial support of INR75 lakh each to the Agriculture Produce Market Committee (APMC) mandi for associated hardware, such as quality-assuring tools and the establishment of infrastructure for cleaning, grading, sorting, packing, composting, etc
• The government has also incentivised drones and artificial intelligence for advanced farming activities.
• The Indian government, which just relaxed foreign investment rules for the space sector, is leaning heavily into the use of satellite data to solve problems on the ground, with agriculture a key focus.

Challenges

• The lack of an integrated database on crop loss, crop images, food shortages, insufficient formal channels to aggregate advisory recommendations for farmers and incomplete data and inconsistency were highlighted as major bottlenecks in the implementation.
• The average landholding size for farmers in India is just 1.08 hectares.
  • That fragmentation, coupled with poverty and low levels of literacy, pose challenges for tech adoption, industry experts said.
• Agriculture has never been a tech-forward sector and often farmers want to rely on traditional practices, or the wisdom of their forefathers

Conclusion

• AgriTech startups are ushering in a new era for Indian agriculture by integrating agriculture practices with artificial intelligence and machine learning.
  • Through the integration of cutting-edge technologies and innovation, these startups are addressing age-old challenges, empowering farmers, and fostering change.
• India’s path to leadership in the new space race lies in utilizing the power of data, and applications within the agricultural sector offer immense potential.
• The digitalisation of agriculture and the launch of an Agriculture Accelerator Fund will usher in new opportunities for businesses and individuals in the country and for the global community at large.
• India offers huge scope for investment in the agri-tech sector, for AgriTech start-ups, digital infrastructure aids, and innovative technologies.