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Agriculture has always played an important role in the lives of many Indians. Having a suitable climate that permits the cultivation of a variety of crops along with high-quality soil has allowed India to become a global powerhouse in food production.

Post-Independence, India used traditional methods of cultivation which were inefficient and time-consuming. The onset of the Green Revolution in the 1960s, spearheaded by M.S. Swaminathan, gave the country a much-needed boost in crop production and efficiency, making India self-sufficient in terms of food security and a net exporter of agricultural products.

Now, a new concept is expected to take the sector to new heights in terms of yield, quality, and productivity. That concept revolves around the digitisation of agriculture. How is India embracing the digital revolution and what does this mean for the future of agriculture in the country? Let’s find out.

The current economics of agriculture in India

The agricultural sector, like most of the sectors in the Indian economy, has experienced good overall growth over a period of 10 years. In fact, the agriculture sector was the only one to record positive growth during the COVID period. Various statistics have been highlighted below to demonstrate the present state of agriculture in the country.

  • In the year 2020, the agricultural sector experienced a growth of 3.6 per cent. This growth increased to 3.9 per cent in the year 2021 due to various government-related schemes, particularly the Atma Nirbhar Bharat (ANB) Abhiyan.
  • In terms of Gross Value Added (GVA), the agriculture sector has contributed approximately 18 per cent as per long-term estimates and trends. This share has recorded an increase to 20.2 per cent in 2020 and 18.8 per cent in 2021.
  • According to World Bank estimates, the agricultural sector in India (as a percentage of total employment) employs approximately 41.5 per cent of the population as of 2020.
  • The contribution of the agricultural sector to India’s economy has experienced steady growth over the years. Agriculture contributed 17.8 per cent to the country’s GDP in the year 2019. The percentage increased to 19.9 per cent in 2020.
  • Total exports of agricultural products have experienced consistent growth. In the year 2020, total agricultural exports amounted to US$41.3b. This amount increased the following year with a total value of US$49.6b.
  • Data from Fourth Advance Estimates shows substantial growth in total food grain production. In 2019, India produced 297.5m tons of grain. In 2020, this amount increased to 308.65m tons.

Digitisation: The future of agriculture

Digitisation of agriculture basically means large-scale integration of technology in agricultural practices. Commonly referred to as agri-tech, the process involves extensive use of modern technologies like the internet and big data to complement various aspects of the agricultural ecosystem.

On the farm level, data collected from various primary sources like drones, sensors, machinery, and various other devices are used to provide farmers with important information from cultivation sites at all times. These devices are used in conjunction with satellites that provide weather-related information which enables producers to monitor crop growth in real-time, calculate plot performance, and forecast the output with considerable amounts of accuracy.

Digitisation also involves the use of AI to interpret data and give powerful recommendations to maximise harvest quantity and quality. Furthermore, it allows producers to make choices regarding the best crops to harvest depending on the region and climate while simultaneously calculating the most productive uses of farm machinery.

All of these factors contribute to increased efficiency and productivity, improved decision-making, and better market linkage for farmers.

How is India cultivating the digitisation of agriculture?

The government of India has recognised the need to modernise and digitise the sector. Through various initiatives, along with the support of various companies and private investors, India is hoping to implement widespread digitisation of this sector by 2025. Invest India has highlighted several key initiatives and events that are driving India’s digital agriculture growth:

  • In September 2021, the government launched the Digital Agriculture Mission 2021-2025. As part of this mission, five memoranda of understanding (MoUs) were signed, all aimed at advancing digital agriculture projects within the country.
  • Various pilot projects with companies like Cisco, ITC, Jio Platforms, and Ninjacart in partnership with government branches like the National Commodity and Derivatives Exchange (NCDEX) and the National e-Markets Limited (NeML) were announced. The mission’s main objective is to facilitate the modernisation of agriculture through the implementation of various technologies like blockchain and AI.
  • NITI Aayog, the public policy think tank for the Government of India, has partnered with IBM for the purpose of developing a crop production forecast model powered by AI. This model is expected to improve yields, monitor soil quality, and provide early detection and warnings for crop disease outbreaks.
  • Cisco developed an Agricultural Digital Infrastructure (ADI) for the purpose of improving the quality of farming and agriculture-related information. This infrastructure was used by the Department of Agriculture under the National Agri Stack to collect and evaluate data.
  • A new platform called Jio Agri (Jio Krishi) was unveiled in February 2020. This platform digitalised the agricultural ecosystem along the value chain to provide convenience to farmers. It makes use of various data sources and utilises AI algorithms to interpret this data. The ultimate goal of the platform is to provide precise and targeted advice to farmers in order to maximise their yield.
  • The Government of India and Microsoft announced a partnership to support the small farmers of India through a pilot programme referred to as the Unified Farmer Services Interface. Ultimately, the aim is to increase farmer incomes through effective price management and yield monitoring by utilising AI-enabled sensors.
  • Six institutions are collaborating to implement the Indian Government’s Sensor-based Smart Agriculture (SENSAGRI) which focuses on the development of drones that use hyperspectral remote sensing (HRS) sensors to monitor crop and soil health. The data collected by these drones will be directly communicated to farmers.

What are the expected outcomes?

Estimates from the NITI Aayog indicate that by 2025, the digitisation of agriculture in terms of AI alone could be worth approximately US$2.6b. An even more remarkable aspect is that this field is experiencing a CAGR of 22.5 per cent.

If digitisation is effectively implemented and short-term targets are achieved, the market size of the agricultural sector is expected to reach INR 111,916b by 2026 as compared to INR 55,994b in 2020, with an expected CAGR of 12 per cent.

There is no doubt that the digitisation of agriculture will greatly benefit the country. With a growing population of almost 1.3b people, digitising this sector is important to meet the inevitable surge in demand for agricultural products and their multitude of uses.

The data indicates that India is on the right track to transforming this traditional sector into an opportunity that could bear fruits in the near future.