Digitisation to drive agritech industry in India

• About $1b is to be disbursed to agritech startups by venture capital funds by 2021. 
• India’s agriculture technology sector could reach $24.1b by 2025, driven mainly by tech-enabled supply chain, output market linkages and financial services.

Bengaluru: The Indian agriculture industry is all set to go hi-tech amidst the fast-paced digitisation of the rural economy.

Two recent reports have emphasised on the bandwidth that is expected to come on board during the next five to ten years, transforming the massively untapped sector into a multi-billion-dollar enterprise. 

As per estimates by EY, India’s agriculture technology sector could reach $24.1 billion by 2025, driven mainly by tech-enabled supply chain and output market linkages – worth $12 billion and financial services, with a market potential of $4.1 billion.

Further breaking down the numbers, the report estimates that the market for precision agriculture and farm management is expected to grow to $3.4 billion and for quality management and traceability could be worth $3 billion. The market for supplying farm inputs will be about $1.7 billion by 2025, the report adds. 

Last week, another report by Omnivore – an agritech venture capital firm indicated a very high interest among startups, technology firms and venture capitalists in the Indian agricultural sector. It estimated that about $1 billion is to be disbursed to agritech startups by venture capital funds by 2021. 

Indicating eight key trends that would drive the future of agriculture in India, the report said that the planned digitisation of the rural sector coupled with the rollout of 6G and 7G technologies by the end of the decade would see significant advances in farm mechanisation and automation, including farm robots taking over labour-intensive tasks and reducing drudgery.

Stating that a billion Indians will have access to data services by 2030 and 840 million estimated smartphone users, the report notes: “6G will arrive, increasing data transfer rates by 10x compared to the 5G. IoT will be able to connect to trillions of connected objects, taking incredibly complex systems live and interactive.” 

The key trends identified are:

• Precision agriculture and automation creating a “farm of one”
• Biotechnology will produce tastier, more nutritious, and eco-friendly crops
• Farms & farmers will be connected, digitised, and smart
• Farmer-consumer intimacy will improve value for both
• Majority of rural jobs will be of higher value and non-agro
• More fresh greens, harvested and delivered, on-demand
• Diversity, quality, and sustainability of food sources will increase
• Food will increasingly (and scientifically) replace medicine

The report further points out the need for investment in horticulture, dairy, poultry, aquaculture and food processing. 

It should be noted that currently only a little more than 600 million of the 1.3 billion Indians are connected to the internet, with majority of the rural zones still connected to 2G network.