The Rise and Rise of Agritech

Human beings have integrated agriculture with technology since thousands of years. Be it using animals for on-field labour, or more recently using High Yielding Variety (HYV) of seeds, there has always been massive improvisation in on-farm work. Over a period of time farming has moved away from an activity of mere sustenance to one of trans-national importance with lucrative economic remunerations. For instance, the Department for Promotion of Industry and Internal Trade (DPIIT) states that the Indian food processing industry has drawn in Foreign Direct Investment (FDI) of USD 10.24 bn across 20 years, between April 2000 and December last year. With rising numbers, turning a blind eye to new developments is a self-kick-in-the-bucket.  

So What’s New Now?

New era requires new thinking, which is what the new age businessperson is banking on. While HYV seeds is something we are all familiar with, startups now are offering previously unheard-of, or innovative use of existing technology. Take for example, a high-tech camera powered system to keep track of the fish in the pen, the sea life, quantity, and quality of the produce. This ensures efficient fish feeding, breeding, potential identification of diseases, and the like, which in turn will pay cascading economic dividends to the farmer.  

In a similar vein, robotics is another area witnessing extensive application. “The first example of the use of robotics is milking. Another is of high-tech mechanization which includes poultry production. Robotic floor egg collection has been addressed in research to deal with floor eggs when switching from the cage systems to loose housing systems for laying hens,” notes CEO Nutrelis Agro Foods, Pradeep Dwivedi.

Additionally, tech-in-agriculture is also used to guide animals while grazing. This has become a viable solution for many cow rangers for example, especially while monitoring their health.

Any farmer will tell you the bane pests are to their crops. The locust swarm we witness annually on the fertile grounds of India are not an exception. Some startups are trying to work on business models that share real-time data with the farmers via photographs and the pest species that may prove to be a nuisance.

In a world of maintaining and sharing data, it is imperative we extend and capitalise it in the agriculture space as well. This will also help unnecessary expenditure on and usage of pesticides, and keep the farmer ready for upcoming challenges.  

Supporting the cause of startups providing predictive technologies, Amith Agarwal, Co-Founder & CEO, agribazaar.com, notes, “There has been an increased application of technology in the agri-sector even for the small farm holder. Alongside mechanization, predictive technology will change the way forward for the Indian farmer and how he handles pre- and post-harvest produce.”    

Thus, in the era of self-driving tractors, drones on fields, satellite imagery, heat and light control, hydroponics, and the like among the new generation of farmers, an all-inclusive approach cannot be discounted.

This includes not just agriculture focused enterprises, but also space-tech startups like Pixxel, which can easily share aerial data of field produce.

The solution these startups are working on will also have to include taking all the players along the supply chain comprehensively into account. Working hand-in-hand is not just a philosophic ideal but makes complete economic sense in the long run.

What Can Be The Issue?

As we spoke about earlier, stability within the supply chain and uniformity in the productivity of agri-tech business are paramount.

While startups are using blockchain and Artificial Intelligence (AI) to solve these issues, “Government policies still have a long way to go to catch up with the utilization of modern technology. Our farms are still not equipped or used to the implementation of AI and other high-end agricultural practices,” adds Dwivedi.

He also notes, “The water availability is getting more and more difficult and natural disasters are getting frequent. We do not have a comprehensive disaster management policy whether it is flood or drought.

Startups should focus on the implementation of new technology to minimize or mitigate such problems but we do not have trained manpower at the farm level.”  

This comes at a time when the government is pushing right, left and centre with all kinds of schemes like Pradhan Mantri Fasal Bima Yojana, PM-Kisan Scheme, among others.

Additionally, in order to use the available technology, the skillset requirement is expanding faster than ever. The country does not have enough workforce engaged in the farming world to cope with such a shortage.

Adding to this is unreliable and unstable electricity availability, limited funding opportunities for the startups, with menial miniscule grants available on federal and state level.

Even if the intention is noble, government policies and logistics support are pivotal to get the ball-rolling. While the Government of India has approved a Production Linked Incentive (PLI) scheme for the food processing sector with an incentive outlay of Rs 10,900 crore over a period of six years starting from FY22, we still have a long way to go. This is a tough position for startups, which could also be why we do not have a single unicorn in this space.

Given the valley between industry expectation and government reality, we cannot expect as common consumers that the quality of food grains will go up, or price of regular farm products will go down any time soon.

What Can Be The Possible Solution?

The agritech space in India is still at a nascent early stage. However, this it is expected to accelerate with digitization and supply-chain gaining prominence, especially with the rise of farm to fork brands.

These brands have taken it upon themselves to sign individual MoUs with the government. “Our MoU with the Department of Agriculture, Government of India to build & promote Digital Agricultural Platform (DAP) among Indian farmers is a good example in this context.

DAP will enable and empower the Indian farmer to approach farming in an integrated manner, with a single source enabling agri-tech platform,” notes Agarwal.

As a part of this collaboration, they will leverage its technological sources to profile agricultural land, enable access to an integrated farmer marketplace for the broader stakeholder ecosystem, develop a generalized advisory platform, & facilitate better access to financial services for farmers.

Likewise, agribazaar’s recent MoU with Central Warehousing Corporation (CWC) to provide e-auction and sales facilitation services for the agri-commodities stored at the latter’s warehouses across the country, is another example of its collaboration with the government.  

While individual contracts are underway and will continue to be so, there are some universal measures being undertaken by the government. The Centre realises this potential and has signed agreements with Microsoft, Amazon, and Cisco Systems to share data and statistics available on the Indian agriculture system since 2014. Indian players like Jio and ITC are emerging as the leading players in the Indian market as far as this deal is concerned.

The idea is to develop a model where the farmers can benefit from the technology offered by these companies. Not only will it benefit the agriculturists, but also help in reducing the food wastage in India, which stands at 40% of total produce as per FAO data. However, we are yet to see full-fledged tangible outcomes.

While it is great to see modern enterprises taking the required steps to support this sector, it cannot be a one-sided job. Presently, the new enterprises must accomplish the tasks of a middleman while they also engage in advanced research and development.

It is in the benefit of economic development that the tasks are streamlined and specialized. If one is looking to develop a niche in this area, now is the appropriate time to claim any first-mover advantage.