Commerce and industry minister Piyush Goyal on Sunday said that the government is considering setting up a fund for agritech businesses.
Agritech simply refers to agricultural technology, which includes everything from artificial intelligence to genetically-modified crops.
The minister during a webinar also said that technology and innovation would be the driving forces behind India’s prosperity and explained that the government expects a large number of startups to participate in defence R&D, for which the government is willing to launch an agritech fund.
He also said the government wants to see more startups involved in defence R&D, as there is a lot of potential for entrepreneurs in the drone, defence and technical textile sectors.
However, with over 65,000 registered firms in just five years, India boasts of the third largest startup ecosystem in the world.
FUTURE OF INDIA’S AGRITECH SECTOR
This sector is critical to any economy because, along with food, it also provides jobs and contributes to technological advancement.
The agritech business in India is believed to have a promising future, especially as it becomes more integrated with tech entrepreneurs.
Due to the rising rural internet penetration, increased post-harvest and supply chain losses, expanding investor interest in the sector and other factors, India’s agritech sector has risen considerably from 43 startups in 2013 to over 1,000 enterprises in 2020.
However, according to reports, it still has a slower-than-expected growth rate. Slow growth in the agritech industry can be attributed to several variables, but experts believe that funding and supply chain challenges are the most important.
It’s feasible that these problems can be addressed with increased investments from domestic and foreign private enterprises, as well as government agencies, resulting in exponential growth and development in agritech over the next several years.
However, it is understood that over the next five years, the agritech industry would develop at a CAGR of about 19%, driven by rising food consumption and disposable income across regions.
More than 80% of the world’s population is believed to rely on agriculture for their livelihood, creating a great opportunity for farmers to use technology to improve their productivity and, as a result, their yield per hectare and revenue.
Additionally, in case of India, the agritech sector received $1 billion in funding between 2017 and 2020, according to the latest Bain & Company analysis. According to the latest Bain & Company report, the market is predicted to grow to $30-35 billion by 2025.
Data analytics, artificial intelligence, machine learning, the Internet of Things, and software as a service are all being used by agritech companies to challenge the traditional agricultural economy (SaaS). This is assisting in the easing of different pain points across the traditional agriculture value chain spectrum, with the potential to unlock a $24 billion industry.
Currently, the farmers face various challenges to make a living from farming.
Malpractices in unorganised agricultural markets, as well as a lack of well-organised production marketing channels, are causing anxiety among Indian farmers. They also have to deal with a lack of transportation and storage options, among other problems.
They have limited access to advanced technologies that allow them to acquire timely information and agricultural solutions, making them vulnerable and isolated—and here come the startups of India.
It is believed that agritech companies can address these concerns right away, transforming the face of Indian agriculture.
The government, meanwhile, is encouraging such startups and promised that by the end of 2022, the income of farmers will be doubled.
However, companies like Ninjacart, AgroStar, WayCool, Stellapps, CropIN Technology, EM3 AgriServices, Intello Labs, Aibono and other such businesses are helping India’s agritech industry to grow by helping farmers.
The agriculture sector got around $3.23 billion in global investment, according to the latest available statistics. A total of $313 million was raised by 53 Indian agritech companies. This is a significant step forward for Indian businesses and the information provided is expected to inspire the young entrepreneurs of the country to explore agricultural technologies.
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