{"id":165127,"date":"2022-01-29T19:00:15","date_gmt":"2022-01-29T13:30:15","guid":{"rendered":"https:\/\/blog.forumias.com\/?p=165127"},"modified":"2022-02-09T11:57:49","modified_gmt":"2022-02-09T06:27:49","slug":"kurukshetra-january-summary-agri-startups-and-enterprises","status":"publish","type":"post","link":"https:\/\/forumias.com\/blog\/kurukshetra-january-summary-agri-startups-and-enterprises\/","title":{"rendered":"[Kurukshetra January Summary] Agri-startups and Enterprises \u2013 Explained, pointwise"},"content":{"rendered":"\n\n\n\n
For\u00a07PM Editorial<\/strong>\u00a0Archives click\u00a0HERE <\/a>\u2192<\/strong><\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n
Introduction<\/h5>\n

India has become the third-largest start-up ecosystem hub. India is home to the highest number of unicorn startups after the US and China. Among them, Agri-startups are providing relevant and innovative solutions to a number of challenges faced all across the agricultural value chain.<\/p>\n

These Agri-startups have been connecting the missing link between the farmers, input dealers, wholesalers, retailers and consumers; connecting each of them and providing strong marketing linkages and quality products on time. Further, these Agri-startups are not only creating new employment avenues but are also leaving a ripple effect on the socio-economic fabric of the Indian demography in which they are operating.<\/p>\n

\r\n\tForumIAS is now in Hyderabad<\/span>. Click here<\/b><\/a> to know more<\/span>\r\n<\/div>\n
Why Agri-startups are essential?<\/h5>\n

The agricultural sector contributes to more than 15% of the country\u2019s GDP. Also, it is one of the biggest employers, with approximately 70% of the rural population employed in the agricultural space.<\/p>\n

However, the sector has been considerably slow in the adoption of technology<\/strong>, largely due to insufficient penetration and those engaged in agriculture being unaware<\/strong> of existing technological advancements.<\/p>\n

Apart from this, the vast unorganised credit structure<\/strong> and absence of proper market linkages<\/strong> add to their woes by contributing to their meagre income. This is where agri-tech startups come into the picture.<\/p>\n\n\n\n
Read more: Nabard announces \u20b9 700-cr venture capital fund for agri, rural startups<\/a><\/strong><\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n
About the status of Agri-startups in India<\/h5>\n
\"Focus
Source: Kurukshetra<\/figcaption><\/figure>\n

India<\/strong> continues to be among the top six countries<\/strong> globally, with the highest number of deals in agricultural technology. (The US, Canada, the UK, Israel<\/strong> and France<\/strong> comprise the other five countries.)<\/p>\n

Currently, 3.8% or 600+ of the total recognised startups in the country are in the Agri-startup space as per the Economic Survey of 2019-20<\/strong>. Of these, 54% are classified as agri-tech while the rest are in the field of dairy farming, food processing and others.<\/p>\n

In 2020 alone<\/strong>, over 20 agri-tech startups have together raised more than Rs. 920 crores across venture debt, equity and conventional debt rounds. It is estimated that $10 billion will be invested in Indian agri-tech startups over the next 10 years.<\/p>\n

Few prominent startups include SatSure<\/strong> (The solutions of this startup are being used by the Andhra Pradesh government, large banks and insurance companies in India), Fasal\u2019s microclimate forecasts, Aibono <\/strong>(provides precision farming technologies backed by real-time synchronisation of supply and demand), Cropin\u00a0<\/strong>(provides a full suite of farm management, monitoring and analytics solutions through its new product called \u2018Smart Risk\u2019), etc.<\/p>\n\n\n\n
Read more:\u00a0Agritech startups have great potential in India<\/a><\/strong><\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n
What are the reasons for the rise in Agri-startups?<\/h5>\n

First<\/strong>, India\u2019s digital ecosystem is witnessing healthy tailwinds such as affordability and availability of high-speed internet and maturing digital content<\/strong> ecosystem e.g., more than 25% of farmers in India today have access to smartphones.<\/p>\n

The confluence of these factors presents an exciting opportunity for innovation in agriculture, wherein market players can leverage next-generation technology such as data digitisation, data platforms data analytics, Artificial Intelligence (AI), Machine Learning (ML), the loT and Software as Service (SaaS) to disrupt the status quo in agri-startups.<\/p>\n

Second<\/strong>, increasing demand for innovation<\/strong> in agriculture and declining last-mile delivery to farmers <\/strong> has increased pressure on extension services which must be re-engineered to a new role focused on organising user\/producer groups, linking farmers to markets, engaging in research, planning and technology selection, enabling changes in policies and linking producers to a range of other support and service networks. This role is being played by agri-techs.<\/p>\n

Third<\/strong>, huge vacancy levels in public extension systems, particularly in remote and disadvantaged regions have further constrained the extension support and services to the farming community<\/strong>. Hence, the Agri-startups utilise these gaps in support and services.<\/p>\n\n\n\n
Read more: Boosting agrifood life sciences is key to India\u2019s agricultural future<\/a><\/strong><\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n
How Agri-startups are disrupting agriculture and empowering farmers
\ndigitally?<\/h5>\n

The agriculture industry is classified into 4 broad divisions. 1) Agri-inputs, 2) Agri-financial services, 3) Food processing companies, and 4) Farm mechanisation. With the advent of agri-tech startups, these divisions have seen several fundamental changes in the way they function. These include,<\/p>\n

a)<\/strong> Agri-startups with novel technologies such as Al, ML and data analytics are making it easier for farmers to improve their methods of farming<\/strong> such as identifying the right crop to be sown for better yield. b) Offering mechanised equipments<\/strong> that are potentially unaffordable for farmers to purchase, on a rental basis<\/strong> thus making the equipment readily available to farmers. c) <\/strong>Agro-based mobile applications make it even more convenient for farmers to access information<\/strong>, d) <\/strong>Enable farmers to have direct access to the market<\/strong> without the need of intermediaries, leading to an increase in their income. e) Help to access formal credit<\/strong>: Agri-startups facilitate financial inclusion by enabling farmers to upload their records digitally and apply for credit.<\/p>\n

Further, Farming-as-a-Service model (FaaS model)<\/strong> is also emerging as the future of agriculture. This model offers innovative solutions for agriculture and allied services through a subscription-based or pay-per-use model which enables stakeholders to make effective data-driven decisions to help boost productivity and efficiency.<\/p>\n\n\n\n
Read more: Seeding a data revolution in Indian agriculture<\/a><\/strong><\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n
How is the Government supporting the Agri-startups?<\/h5>\n

The Government of India has taken several initiatives to boost support to the agri-startups. These include,<\/p>\n

Government schemes like the setting up of the National Centre for Management and Agricultural Extension in Hyderabad (MANAGE)<\/strong> and the Department of Science and Technology<\/strong> have given a tremendous boost to Agri-startups. The focus area of the DST has been on accelerating agri-tech startups by providing mentoring, industry networking and investor pitching guidance.<\/p>\n

According to a NASSCOM report, the Indian Government specifically supports agri-tech startups through its Startup India Program<\/strong><\/a>.<\/p>\n

Startup India Seed Fund Scheme (SISFS)<\/a><\/strong>: The scheme aims to provide financial assistance to startups.<\/p>\n

Ministry of Agriculture and Farmers\u2019 Welfare<\/strong> is supporting the startups through initiatives like the Agriculture Grand Challenge<\/strong> which further validates Agri-startups.<\/p>\n

Department of Agriculture, Cooperation and Farmers Welfare (DACFW) has launched a new component called \u2018Innovation and Agri- Entrepreneurship Development\u2019. It has been launched under the Rashtriya Krishi Vikas Yojana (RKVY-RAFTAAR)<\/a>.<\/p>\n\n\n\n
Read more: Agritech Challenge: AIM, NITI Aayog & UNCDF announce first AgriTech cohort under South-South Innovation platform<\/a><\/strong><\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n

Apart from that, the other programmes include<\/p>\n

a) The Department of Biotechnology runs Biotech Parks and incubators programme<\/strong>, b) NITI Aayog runs a comprehensive Atal Innovation Mission<\/strong><\/a>, c) AGNIi-Accelerating Growth of New India\u2019s Innovations<\/a><\/strong> – under the Office of Principal Scientific Adviser, d) DigiSaksham<\/a>, <\/strong>e) Ministry of Development of North Eastern Region has launched Initiative for Development of Entrepreneurs in Agriculture (IDEA)<\/strong> which intends to promote agri-business, f) Start-up Accelerators of MeitY for pRoduct Innovation, Development and growth (SAMRIDH<\/strong>)<\/a>, g) Dairy Entrepreneurship Development Scheme<\/strong> under Department of Animal Husbandry, Dairying and Fisheries.<\/p>\n\n\n\n
Read more: Challenges Facing Dairy Sector in India \u2013 Explained, Pointwise<\/a><\/strong><\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n
What are the challenges faced by Agri-startups?<\/h5>\n

In a market worth more than $350 billlon, the combined revenue of all agri-tech startups in India is estimated to be less than $100 million. This is due to various challenges like,<\/p>\n

1)<\/strong> Small and scattered landholdings<\/strong> of farmers reduce<\/strong> the scope of technology scale-up<\/strong>, leading to poor cost-effectiveness, 2)\u00a0Rate of return<\/strong> on technology investment has not proven very profitable<\/strong> in case of agri-tech startups as compared to other IT-based startups, 3)\u00a0<\/strong>Agri startups and enterprises are finding it hard to retain technical talent<\/strong> working in this sector, 4)<\/strong> Technology adoption and penetration is a very slow process which certainly diminishes investors\u2019 interest<\/strong>. 5) High-priced technology solutions are unaffordable <\/strong>for a large user group, i.e. small and marginal farmers, 6)<\/strong> Most of the technology solutions available are not localised to emerging markets, 7)<\/strong> Making farmers adaptive<\/strong> to the required skills for working on advanced technologies requires significant effort<\/strong>, 8) <\/strong>Facilitating the adoption of proven technologies<\/strong> through subsidy is yet to gain momentum, 9) Regulations<\/strong>, though favourable, are complex<\/strong> in nature.<\/p>\n\n\n\n
Read more: [Kurukshetra December Summary] Fostering Innovation and Entrepreneurial Skills among Rural Youth \u2013 Explained, pointwise<\/a><\/strong><\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n
What should be done to promote Agri-startups?<\/h5>\n

First<\/strong>, there is a need to develop mobile training programmes<\/strong> for the capacity building of farmers and help them adapt and adopt to new technological advancements.<\/p>\n

Second<\/strong>, increased and timely support<\/strong> to early-stage startups will boost agri-tech startups in India.<\/p>\n

Third<\/strong>, there is a need for corporate and government accelerators<\/strong> to help agri-tech startups. This is because only 9% of all funding in the last 5 years was focused on growth-stage startups. For this, large companies need to effectively collaborate with startups<\/strong>.<\/p>\n

Fourth<\/strong>, the government need to set up agri-tech-focused incubators and grants<\/strong>.<\/p>\n

Fifth<\/strong>, Karnataka<\/strong> alone is home to 70% of agri-tech startups. The other states need to come up with favourable policies to attract startups and investors similar to Karnataka.<\/p>\n

Sixth<\/strong>, banks and financial organisations need to offer more creative models of financing<\/strong> for farmers, entrepreneurs, incubators, and accelerators.<\/p>\n

Seventh<\/strong>, in order to make agri-startups successful, it is crucial to enable seamless hybridisation<\/strong> of relevant technology by building a promising \u2018new-age distribution model<\/strong>\u2019. Agri-startups have to reorient and customize their models for a sector that has low technology adoption rate.<\/p>\n

In conclusion, technology is just one component; an evolved distribution system with a human touch is what will make the agri-startup models scalable over time. Agri-startups are poised to play a vital role in increasing the productivity of the agriculture and allied sectors and power Indian economy’s structural transformation. Government should create an enabling environment for them to thrive.<\/p>\n","protected":false},"excerpt":{"rendered":"

For\u00a07PM Editorial\u00a0Archives click\u00a0HERE \u2192 Introduction India has become the third-largest start-up ecosystem hub. India is home to the highest number of unicorn startups after the US and China. Among them, Agri-startups are providing relevant and innovative solutions to a number of challenges faced all across the agricultural value chain. These Agri-startups have been connecting the… Continue reading [Kurukshetra January Summary] Agri-startups and Enterprises \u2013 Explained, pointwise<\/span><\/a><\/p>\n","protected":false},"author":10311,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"jetpack_post_was_ever_published":false,"footnotes":""},"categories":[130,9,10627],"tags":[],"class_list":["post-165127","post","type-post","status-publish","format-standard","hentry","category-7-pm","category-public","category-yojana-and-kurukshetra-summary","entry"],"jetpack_featured_media_url":"","views":"","jetpack_sharing_enabled":true,"_links":{"self":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/posts\/165127","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/users\/10311"}],"replies":[{"embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/comments?post=165127"}],"version-history":[{"count":0,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/posts\/165127\/revisions"}],"wp:attachment":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/media?parent=165127"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/categories?post=165127"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/tags?post=165127"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}