Agritech Challenges and Opportunities

The history of India’s agricultural dates back to the Neolithic period. From the earliest civilizations to the modern economy, the agriculture has been the back bone of our nation’s progress. Even today, agriculture employs over 50% of the total workforce. However, the primary sector accounts to approximately 18% of the total GDP.?

The Agritech Industry, as the name implies, uses the modern technology to build a more efficient agricultural infrastructure. Currently, our nation has over 1300 Agritech start-ups that are trying to come up with new technology with the aim to change the landscape of the Indian primary sector. If implemented well, the industry will not only improve the yearly yield from the farms, but will also significantly improve the income of farmers across the nations.

Opportunities:

Being one of the largest agricultural producers of the world, India’s potential for growth in the agritech industry is exponentially high. The agricultural value chain is a multi-dimensional system that starts at the farm inputs. Using technology to modernize or improve any part of the value chain can open up prospects for investments.?

These opportunities may lie in providing services like:

Facilitating market linkage (For both, Input and Output);

Farm Management;

Better financial service; and more.

Or?

Offering products to facilitate the farming process.

The wise scope of product and service offerings allow the investors to implement several types of business models in the industry. These business models may include:

Margin-based model;

Subscription based model; and?

Transaction based model.?

While the agritech industry, as a whole, is experiencing a boon period. The Supply chain technology and output markets have the most potential for growth, followed by farm management and quality management.

Challenges:

While the agritech is one of the most promising business prospects in the nation, it also faces several challenges that may prevent the investors from committing to the industry.

These challenges may include:

Government Policies:

The government policies are yet to catch up the potential of the agritech industry. While programmes like Digital India and Start-up India are up and running, there is still no project aimed at the farm level.

Forces of nature:

The agricultural yield is highly dependent of the climate conditions. Unfavourable weather or a natural calamity like a flood or a draught have a huge impact on the sector.

Lack of infrastructure:

Many remote rural areas of the nation still do not have an easy access to the rest f the world. The internet is not always available and energy sources are also unable to fulfil the requirement of the agritech industry.

Skill development:

While the technology has been growing exponentially over the past 3 decades. The skill and knowledge of our farmers is yet to catch up.?

Funding:

Owing to the above-mentioned challenges along with a few other factors, the major investors still are hesitant to fund the agriteh industry. The unpredictable nation of the primary sector has kept investors at bay for a long time.?

Summary:

While technology has revolutionised both the secondary and tertiary sector, it is yet to fully penetrate the agriculture industry. This makes agritech industry one of the most promising industries to invest . Over the next few years, as the technology become more sophisticated and the farmers garner more skills, we are bound to see an explosion of the agritech industry.