Be it education, healthcare, or the roadside vendor, the biggest takeaway for every sector — organised and unorganised — from the Covid-19 pandemic is adapting to the new normal. And this ‘new normal’ is almost entirely technology driven. Individual businesses and collective sectors will depend on how quickly they embrace newer technologies, and farming is no exception.
Farmers, who form one of the oldest industries civilisation has known, must embrace a digital, connectivity-fuelled transformation in order to overcome increasing demand and benefit from the quality of their produce directly from the consumer without the involvement of middlemen.
Advances in machinery have expanded the scale, speed, and productivity of farm equipment, leading to more efficient cultivation of larger land parcels. Seed, irrigation, and fertilisers also have vastly improved, helping farmers increase yields.
Now, agriculture is in the early days of yet another revolution, at the heart of which lie data and connectivity.
Artificial intelligence, analytics, connected sensors, and other emerging technologies could further increase yields, improve the efficiency of water and other inputs, and build sustainability and resilience across crop cultivation and animal husbandry.
As India aspires to compete with China and the US in the agritech space, here are a few numbers. According to Agfunder, India witnessed an increase in funding from $619 million in H1 2020 to $2 billion in H1 2021, which is significantly lesser than what the US ($9.5 billion) and China ($4.5 billion) got.
A 2020 study by EY placed the Indian agritech market potential at $24 billion by 2025, of which, only 1 per cent has been achieved so far. Among various agritech segments, the supply chain technology and output markets have the highest potential, worth $12.1 billion.
The farm laws mess
It is estimated that there are about 500 agritech start-ups in India, operating at various levels of supply chains. Almost all of them would have benefited from the new farms laws which have now been repealed. It is too early to predict as to what extent this decision will affect the agritech start-ups, but at this juncture it can be said that the development would not have come as good news for these start-ups.
Let’s focus on how farmers are being empowered by these start-ups, especially when India is emerging out of Covid-19 pandemic and there are no guarantees whatsoever that we have fully beaten it (many countries in Europe are going into lockdown again).
Through the use of artificial intelligence, machine learning, internet of things (IoT), etc., these start-ups are connecting farmers, small operators such as kirana shops, the neighbourhood mom-and-pop stores, the delivery start-ups and ultimately the consumer under one umbrella.
Through these start-ups, farmers are also able to directly connect to bigger players who buy quality produce in bulk.
The Indian farmer is not as technologically advanced as his Western counterpart. Also, tech penetration in the rural landscape is not widespread enough.
The agritech start-ups have solved this problem by starting a unique farmer-to-business (F2B) model. One such start-up is Dehaati Beej Se Baazar Tak, a full-stack agri-service firm that engages through B2F (business-to-farmer) and F2B models. It uses data science, agriscience and analytics to nurture a ecosystem of farmers, micro-entrepreneurs and institutional buyers.
With a total funding of $162 million since June 2014, Dehaat raised $115 million in October 2021 alone; this is reported to be one of the biggest fundings in the agri-tech space. Dehaat is present in Bihar, West Bengal, Odisha, and Uttar Pradesh, and is working with 6,50,000 farmers through 1,890 centres.
Then there is Ninjacart, which sources fresh produce from farms and supplies to retailers, restaurants, grocery and kirana stores, and small businesses and is operational in around a dozen cities.
It claims to have reduced wastage to 4 per cent compared to up to 25 per cent in traditional chains through demand-driven harvest schedule.
Even e-commerce platforms that are driven by the agritech start-ups will over a period of time steer the shift from government-controlled agricultural markets towards demand-driven digital markets.
How long will it take? Again, not easy to predict as India’s biggest challenge is to scale up farmer outreach.
This probably explains why the farming sector, which contributes 16 per cent to the GDP and employs more than 45 per cent of the workforce, is nowhere near leveraging the benefits of technological innovations that are being offered by agritech start-ups.
The writer is Executive Chairman and Managing Director at OmniActive Health Technologies
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