Around 43 percent of India’s employment is supported by agriculture. It is therefore one of the most important economic sectors along with being our prime source for sustenance. Agritech, a specific category within the ‘technology’ spectrum provides assistance and formidability to the agricultural sector. The agronomic processes encompass diverse solutions in every step, ranging from the sowing of seeds to the harvesting of crops. The processes comprise of integrated resolutions to enhance efficiency within agricultural organisations, along with benefiting smallholder and marginal farmers.
In recent times, Agritech or Agtech solutions are gaining impetus because of their efficiency and the awareness that the sector is economically driven. Agritech has revolutionised the agricultural space and hence, it has caught the eyes of investors as well as massive corporations.
The upward curve of investments and profitability within the industry does not seem like it would dip anytime soon, with a continuous maturity – breaking barriers, and records. Since 2013, funding within the Agritech sector has increased by roughly a whopping 370 percent. According to an AgFunder report, specifically, start-up investments bucked global venture capital markets across all sectors to US$4.7 billion in 2019. The 695 deals were carried out across 940 unique investors.
Similar growth cannot be looked forward to for the remainder of 2021, due to the second wave of Coronavirus governing industries across all business streams. However, there is less chance of the investments cutting to a freefall wherein they would dip way lower than initially expected.
Localising our viewpoint, we notice that most of these investments are still being carried out within the United States. However, investments in India continue to rise at a rapid rate, representative of a two-way flow (up-stream as well as down-stream) of funding, again highlighting the maturity of the sector.
Our world is at a point today, where overpopulation is a severe problem in various countries, along with the overall population set to increase by 30 percent over the next 35 years, according to Global-Engage.com. The article cites that food production on an overall scale will have to increase from 8.4 tonnes to roughly 13.5 tonnes a year by 2050. To work towards an increase in the production of food, along with keeping a tap on the factor of ‘sustainability’, it is essential and integral to adopt smart farming and smart agricultural practices, allowing processes and outcomes to become more efficient in the long run.
The importance of utilising ‘big data’ and ‘predictive analytics’ to counteract the issues faced by farmers daily is now more than ever. They will allow farmers to achieve and maybe even surpass their targets for the seasons, resulting in an influx of productivity. In a survey conducted with farmers, 60 percent mentioned that precision farming is an influential trend to look towards for a structural and foundational change in the way daily practices take place. With the risk of climate change looming overhead at all times, it is crucial to understand the essential need to channel funds towards projects that solve difficult and foreseen problems.
Today, 25-30 percent of all food produced is wasted, which incurs a social, economic, and environmental cost of US$2.5 trillion annually. An outdated supply chain with no digital integrations or climate-smart advisory results in around 20 percent of the crops produced in developed countries being left in the field itself. To spark a change and make a difference, socially conscious investors who look to profitability as well, view the Agritech sector as a gold mine, essentially killing two birds with one stone.
Agritech today is an area that is ripe for innovation with limits imposed solely due to constraints in terms of available capital. When this constraint is counteracted, creativity applied to Artificial Intelligence and food production will be ten-fold.
(Views expressed in the article are author’s own.)