{"id":37757,"date":"2021-11-11T11:03:11","date_gmt":"2021-11-11T05:33:11","guid":{"rendered":"https:\/\/corpbiz.io\/learning\/?p=37757"},"modified":"2021-11-11T11:03:13","modified_gmt":"2021-11-11T05:33:13","slug":"impact-of-agritech-startups-on-the-indian-agriculture-sector","status":"publish","type":"post","link":"https:\/\/corpbiz.io\/learning\/impact-of-agritech-startups-on-the-indian-agriculture-sector\/","title":{"rendered":"Impact of Agritech startups on the Indian Agriculture Sector"},"content":{"rendered":"\n<p class=\"has-drop-cap\">The ever-evolving startup ecosystem in India has been proactively\nplaying its part in disrupting the agriculture sector. Agritech startups are\nfunctioning in a key market with a projected potential of US$24b by 2025.\nIndia\u2019s digital sphere is seeing sharp growth on account of affordability and\navailability of speedier internet connections &amp; maturing digital content\necosystem.&nbsp;<\/p>\n\n\n\n<p>The impact of the said factors facilitates a promising opportunity\nfor innovation in the Agri sector, wherein market players, including new\nentrants, can leverage cutting edge technology such as data platform &amp; data\ndigitization, AI, data analytics, ML, i.e. machine learning, IoT, &amp; SaaS to\ndisrupt the current state of affairs.&nbsp;<\/p>\n\n\n\n<p>While the GOI latest reforms such as deregulation of Agricultural\nProduce Market Committee marketplaces are anticipated to strengthen the Agri\nsector, the full potency of this sector can only be realized via widespread\nadoption of technology.&nbsp;This is helping in resolving several key issues\nacross the spectrum of the traditional agriculture value chain &amp; presents a\nstrong market that is valued at US$24b.<\/p>\n\n\n\n<div id=\"ez-toc-container\" class=\"ez-toc-v2_0_82_2 counter-hierarchy ez-toc-counter ez-toc-grey ez-toc-container-direction\">\n<div class=\"ez-toc-title-container\">\n<p class=\"ez-toc-title ez-toc-toggle\" style=\"cursor:pointer\">Page Contents<\/p>\n<span class=\"ez-toc-title-toggle\"><a href=\"#\" class=\"ez-toc-pull-right ez-toc-btn ez-toc-btn-xs ez-toc-btn-default ez-toc-toggle\" aria-label=\"Toggle Table of Content\"><span class=\"ez-toc-js-icon-con\"><span class=\"\"><span class=\"eztoc-hide\" style=\"display:none;\">Toggle<\/span><span class=\"ez-toc-icon-toggle-span\"><svg style=\"fill: #999;color:#999\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" class=\"list-377408\" width=\"20px\" height=\"20px\" viewBox=\"0 0 24 24\" fill=\"none\"><path d=\"M6 6H4v2h2V6zm14 0H8v2h12V6zM4 11h2v2H4v-2zm16 0H8v2h12v-2zM4 16h2v2H4v-2zm16 0H8v2h12v-2z\" fill=\"currentColor\"><\/path><\/svg><svg style=\"fill: #999;color:#999\" class=\"arrow-unsorted-368013\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"10px\" height=\"10px\" viewBox=\"0 0 24 24\" version=\"1.2\" baseProfile=\"tiny\"><path d=\"M18.2 9.3l-6.2-6.3-6.2 6.3c-.2.2-.3.4-.3.7s.1.5.3.7c.2.2.4.3.7.3h11c.3 0 .5-.1.7-.3.2-.2.3-.5.3-.7s-.1-.5-.3-.7zM5.8 14.7l6.2 6.3 6.2-6.3c.2-.2.3-.5.3-.7s-.1-.5-.3-.7c-.2-.2-.4-.3-.7-.3h-11c-.3 0-.5.1-.7.3-.2.2-.3.5-.3.7s.1.5.3.7z\"\/><\/svg><\/span><\/span><\/span><\/a><\/span><\/div>\n<nav><ul class='ez-toc-list ez-toc-list-level-1 eztoc-toggle-hide-by-default' ><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-1\" href=\"https:\/\/corpbiz.io\/learning\/impact-of-agritech-startups-on-the-indian-agriculture-sector\/#Agritech_market_in_India_at_a_glance\" >Agritech market in India at a glance<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-2\" href=\"https:\/\/corpbiz.io\/learning\/impact-of-agritech-startups-on-the-indian-agriculture-sector\/#How_Exactly_Agritech_is_improving_agricultural_sector_in_India\" >How Exactly Agritech is improving agricultural sector in\nIndia?<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-3\" href=\"https:\/\/corpbiz.io\/learning\/impact-of-agritech-startups-on-the-indian-agriculture-sector\/#Government_initiatives_to_boost_agritech_ecosystem_in_India\" >Government initiatives to boost agritech ecosystem in\nIndia<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-4\" href=\"https:\/\/corpbiz.io\/learning\/impact-of-agritech-startups-on-the-indian-agriculture-sector\/#Conclusion\" >Conclusion<\/a><\/li><\/ul><\/nav><\/div>\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Agritech_market_in_India_at_a_glance\"><\/span>Agritech market in India at a glance<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>Indian agriculture\nhas witnessed a drastic transformation from being state-focused in maintaining\nfood security to becoming a prominent global producer. There is no doubt that\nIndian agriculture has got all the potential to become &#8220;the food bowl of\nthe world&#8221; if our nation focuses on;&nbsp;<\/p>\n\n\n\n<ul><li><em><strong>Building efficiencies into the agri produce trade,<\/strong><\/em><\/li><li><em><strong>Integrating quality norms as part of trade protocols, and&nbsp;<\/strong><\/em><\/li><li><em><strong>Optimizing the cost of productions to rule out competition&nbsp;<\/strong><\/em><\/li><\/ul>\n\n\n\n<ol><li>Agriculture is the fundamental source of livelihood for almost sixty per cent of India&#8217;s population. Agriculture and other related sectors accounted for nearly 18% of gross value added in India in FY 2020-21.\u00a0While the Covid-19 pandemic took a toll on most sectors and services, the agriculture sector remained afloat &amp; helped sustain end-users demand.\u00a0<\/li><li>In view of recent industry estimates, end-users spending in our nation will return to growth in FY 2021 after Covid-led contraction, expanding by as much as 6.6%<\/li><li>India&#8217;s food sector is poised to witness sharp growth, increasing its contribution to global food trade every year owing to its great potential for value addition, particularly within the food processing.<\/li><li>The food processing industry is quite massive in India, accounting for 32% of the nations&#8217;s overall food market &amp; ranking 5th on account of production, consumption, export, &amp; proposed growth.\u00a0<\/li><li>India has also witnessed considerable growth in agriculture exports during FY 2020-2021. As per the <strong><em>Ministry of Commerce &amp; Industry<\/em><\/strong><sup><a href=\"https:\/\/en.wikipedia.org\/wiki\/Ministry_of_Commerce_and_Industry_(India)\"><strong><em>[1]<\/em><\/strong><\/a><\/sup>, the exportation of agri-based products grew by 17 per cent in FY 2020-21 after being lethargic for the past three years<\/li><\/ol>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"How_Exactly_Agritech_is_improving_agricultural_sector_in_India\"><\/span>How Exactly Agritech is improving agricultural sector in\nIndia? <span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<ul><li>Agritech players are changing\nthe face of the Indian agriculture sector by presenting the latest technologies\nthat improve all stages of the value chain.<\/li><li>Players in market linkages are\nensuring seamless blending of the latest tech with physical infrastructure to\nfacilitate farm inputs at a greater price certainty<\/li><li>Farm management players &amp;\nPrecision agriculture are enabling farmer to improve their yields by up to\nthirty per cent&nbsp;<\/li><li>Traceability players &amp;\nQuality management are enabling farmers to realize the benefit of incentivizing\nhigh-quality produce<\/li><li>Players functioning in the\noutput market linkages segment &amp; supply chain tech are mitigating pain\npoints such as high wastage of farm produce, which is profitable for both\nfarmers and end-users.&nbsp;<\/li><li>Financial services entities\ncould have access to thirty per cent of farmer households via access to credit,\n&amp; 65% of farmer households via crop insurance<\/li><li>Business models in the Agritech\necosystem could be categorized into the following:&nbsp;<\/li><li>Margin-based models where\nplayers underpin market linkages on the input or output side &amp; reap margins\non the buy-sell spread<\/li><li>The subscription-based model is\na model where players facilitate a mix of hardware, software &amp; services to\naid farmers to boost crop yields, keep a tab on the produce across the entire\nvalue chain<\/li><li>The transaction-based model is\nwhere player charges based on the no. of transactions addressed, such as\ninsurance policies or loans.&nbsp;<\/li><li>Demand-side drivers such as\never-growing customer\u2019s dynamics towards healthier food owing to urbanization,\nessential to minimize food wastage in India, environmental factors such as a\nwater shortage &amp; climate change are boosting the adoption of agritech in\nthe nation.&nbsp;<\/li><li>Agritech players serving the\naddressable segments across the nation have received healthy funding of US$532m\nas of April 2020.<\/li><li>A comparison with worldwide\ninvestment funding patterns discloses that farm management companies in India\nstill lack the required funding.&nbsp;<\/li><li>Worldwide Investors can\nleverage their knowledge from their past stories in these segments to enable\nthem to realize their potential.&nbsp;<\/li><\/ul>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Government_initiatives_to_boost_agritech_ecosystem_in_India\"><\/span>Government initiatives to boost agritech ecosystem in\nIndia<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>Both state and central governments have rolled out various\ninitiatives to incentivize the agritech ecosystem in India. An initiative like\nNational Agricultural Market aims to mitigate information asymmetry in pricing\nvia a digital trading portal. State governments are underpinning tech\npartnerships to forecast prices of agricultural produce utilizing artificial\nintelligence to aid farmers in effectively planning their harvest cycle.&nbsp;<\/p>\n\n\n\n<p>Incentivizing localized data gathering on soil health &amp;\nrendering access to government-based research units to agritech startups could\nfurther speed up the adoption of agritech. Lessons from nations such as the\nIsrael &amp; United States seek to build a flexible agritech policy framework\nin India which entails collaboration between all market players such as\nagritech entities, farming communities, FBOs, research institutions &amp;\ntechnology providers.&nbsp;<\/p>\n\n\n\n<p>Cross-nation collaboration in agritech &amp; operating models could\nbe driven via such a policy framework. Despite the excellent investment\nactivity in recent years, the market penetration in the Agri sector is still on\nthe lower side. However, it is expected that the untapped market potential in\nagritech will continue to stimulate growth in the space in the coming years.&nbsp;<\/p>\n\n\n\n<p>As the agritech ecosystem attains maturity, a few fruitful scenarios\ncould play out in the Agri sector. There is a likelihood for players to expand\nacross the sector to rejoice in the end-to-end relationship with the farmer.\nAlso, there is a chance for some prominent retailers to expand their grocery\npresence via backward integration. FBOs could also acquire agritech facilities\nto keep a tap on their quality and operations.<\/p>\n\n\n\n<p>Going forward, we could encounter a spike in penetration of segments\nsuch as precision agriculture, financial services, quality management, and\nquality management, considering the healthy market potential that these\nsegments facilitate and the quantum of investment funding these segments have\nencountered.&nbsp;<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Conclusion\"><\/span>Conclusion<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>Agritech <a href=\"https:\/\/corpbiz.io\/startup-india-registration\"><strong>startups<\/strong><\/a> need to underpin measurable business models with higher unit economics while stimulating rather than displacing conventional value chain participants to succeed. It is vital to acknowledge that small &amp; marginal farmers constitute the primary share of India\u2019s land holding, which is 86% to be exact. Consequently, solutions to challenges in the Agri sector need to be inclusive of the requirement of these farmers.\u00a0<\/p>\n\n\n\n<p class=\"text-left\"><b>Read our article<\/b>:<mark style=\"background: #fffd03 !important;\"><a href=\"https:\/\/corpbiz.io\/learning\/gst-impact-on-the-agricultural-sector\/\">An Insightful Explanation on GST Impact on the Agricultural Sector <\/a><\/mark><\/p>\n","protected":false},"excerpt":{"rendered":"<p>The ever-evolving startup ecosystem in India has been proactively playing its part in disrupting the agriculture sector. Agritech startups are functioning in a key market with a projected potential of US$24b by 2025. India\u2019s digital sphere is seeing sharp growth on account of affordability and availability of speedier internet connections &amp; maturing digital content ecosystem.&nbsp; [&hellip;]<\/p>\n","protected":false},"author":22,"featured_media":37778,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":[],"categories":[968],"tags":[2021],"acf":{"service_id":"250"},"authorName":"Pankaj Tyagi","authorImageUrl":"https:\/\/corpbiz.io\/learning\/wp-content\/uploads\/2022\/01\/MicrosoftTeams-image-42.jpg","authorDescription":"Pankaj has a diverse experience of writing research papers, blog, and articles during his college time. Earlier, he was working as a tax consultant in a financial firm, but his interest in writing drives him to pursue a career in the writing field.","postViews":5156,"readingTime":4,"_links":{"self":[{"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/posts\/37757"}],"collection":[{"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/users\/22"}],"replies":[{"embeddable":true,"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/comments?post=37757"}],"version-history":[{"count":32,"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/posts\/37757\/revisions"}],"predecessor-version":[{"id":37790,"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/posts\/37757\/revisions\/37790"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/media\/37778"}],"wp:attachment":[{"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/media?parent=37757"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/categories?post=37757"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/tags?post=37757"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}