Agriculture is known as the backbone of the Indian economy, employing 40% of the population. However, this sector falls short on several fronts like productivity, efficiency, and infrastructure.
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Riding on the backbone of these pain points backed by innovations and technology is the agri-tech segment which aims to increase profitability, yield, efficiency, and quality in the sector. Many agri-tech players realise the gaps in the agricultural value chain and are finding ways to improve to increase farmers' share in crop sales. You can project the agri-tech market to grow to a 30-35-billion-dollar market by 2025.
How should an entrepreneur tackle these pain points?
To discuss this and more, ‘Building It Up With Bertelsmann’ a series moderated by Shruti Mishra, Deputy Editor, CNBC TV-18, calls upon an esteemed panel of industry leaders who share their insights and decode agri-tech. Our panelists include:
Reports suggest that India is the third-largest country concerning agri-tech funding and agri-tech startups. Rohit Sood shares his views on what has led to this phenomenal growth in recent years and what does the future hold? He said that the market was always large, which shows that an opportunity always existed. The retail market stands at $900 billion. But when you remove groceries from that, it is a $300 billion space.
The factors contributing to this change include Jio leading to the adoption of the internet, which was omnipresent. Players like WhatsApp have changed the adoption of tech in the rural economy. Citing an example, the consumption of videos on the Agrostar app has gone up by 10x in the last year.
Another factor includes innovations in the logistics sector. It all started with e-commerce, with Amazon being at the frontier. But, with the playbook in their hand, many companies have the confidence and capability to build farm-to-fork supply chains.
Talking about the genesis of Agrostar, its mission, and vision, Sitanshu Sheth says that overall they are working with the main aim of helping farmers win. At the core, they are trying to solve a vital problem–Indian yields from the farmers are among the lowest in the world, translating to lower incomes for the farmers. Two things that lead to this are- lack of credible information and quality products. Agrostar is helping provide end-to-end solutions to farmers. But it did not start like this. From the manufacturing of organic fertilisers to building an agri-tech solutions platform- Agrostar was born.
When the first wave of the pandemic hit the country, mobile penetration among farmers saw a boost, with them calling on their helpline number. It helped them talk to farmers, looking to gain information about products, information dosages, usage with other products, and more. We realised this gap and tapped into the market.
Bijak has taken a contrarian approach of helping traders and intermediaries in the agri-output supply chain. While other startups look to remove these intermediaries, Nukul Upadhye shares what led them to take this approach. The key to understanding the agri-output supply chain is to target multiple geographies from the get-go. You need to adopt a collaborative approach to create a massive impact. The first step was to take all help from the existing value-chain participants. Despite the drawbacks of the supply chain, it has seen tremendous growth and evolution.
The unorganised sector turned out to be remarkably more resilient than most institutions during the pandemic. Lastly, the participants in the value chain have built domain expertise over generations. It made sense to leverage this expertise rather than bypass them.
Tech will play a critical role in boosting the micro and macro sectors. Apart from the value chain and market access, high-value crops will create a fundamental change; in the agri-tech market. Tech, data, and digitisation will lead to an increase in the farmer’s income. It may be a slow process, but it will happen. Agri-tech will also help solve the problem of over-employment at the farm level.
This is a partnered post.