Agriculture is a critical pillar of the Indian economy, engaging 43% of the national employed workforce. However, smallholders – those owning less than 2 hectares of land – account for 86% of all farmers in India and are still some of the poorest people in the country. They earn only 39% of what medium holders earn and a mere 13% of what large holders earn. These smallholder farmers face challenges such as low visibility of demand, exploitative intermediation, limited quality assurance, restricted access to efficient and low-cost logistics, and low bargaining power.
To improve farmer incomes, it is essential to enhance their value capture and drive overall value creation in the agricultural ecosystem. Here are some opportunities and solutions:
- Direct Matching Between Farmers and Buyers: Facilitating direct connections between farmers and buyers can reduce intermediaries and improve value capture.
- Transparent Quality Assessment: Ensuring transparent quality assessment of produce helps farmers fetch better prices.
- Cost-Efficient and Timely Transportation: Efficient logistics and transportation systems minimize losses and enhance value.
- Aggregation of Small-Volume Produce: Pooling small quantities of produce can lead to better market access and higher value.
Technology plays a crucial role in addressing these challenges. Agri-tech innovations can significantly impact India’s small farmers by driving value creation and increasing value captured by farmers. Integrated ecosystem solutions have the potential to add $76 billion annually to the agricultural system, with most of this benefit going directly to farmers1.
Additionally, several startups are revolutionizing Indian agriculture through technology. Some notable agritech startups include:
- Cropin: A Full-Stack Agritech organization that combines agriculture with enterprise resource planning and business intelligence.
- SFarmsIndia: A web program that serves as a portal for listing and fraction trading agricultural land.
- Farm2Fam
- KhetiGaadi
- Crofarm
- BigHaat
- BharatAgri
- Aarav Unmanned Systems2.
By leveraging technology and sustainable practices, India can empower its farmers, enhance productivity, reduce risks, and improve overall quality of life in the agricultural sector3. It is expected that 75–91 million farmers would benefit from these solutions over a 20-year timeframe, accounting for 35-43% of all farmers in India. With the extra value capture, income from crop cultivation among the impacted farmers could increase by 70-80% over the same period1.