Wednesday, December 8, 2021

The digital technology in farming

 

The Indian agriculture sector is currently valued at US$ 370 billion. According to the Economic Survey 2020-21, GDP contribution by the agriculture sector is likely to be 19.9% in 2020-21, increasing from 17.8% recorded in 2019-20. Logically, a high growth in agriculture is not expected to lead to a high GDP growth due to its relatively low share in GDP.

Thus, in certain quarters it is suggested that the agriculture sector has to grow at about 6.6% so that all the productive sectors, together, may fulfil the US$ 5 trillion GDP objective.
However, in FY1981 the growth rate of the agriculture sector was around 14% contributing to India’s GDP. During the same period India’s GDP growth rate stood at 6.7%.

This is the challenge and the opportunity, technically. The Research Bureau of PHD Chamber of Commerce and Industry, in it’s report shows some silverlines. For example, India is the largest producer of milk & 2nd largest producer of fruits & vegetables. The government expects food processing to grow by 25% of the total produce by 2025.

The food processing industry is one of the largest industries in India and ranks 5 th in terms of production, consumption and exports. As per the estimates for FY15, food processing sector stood at US$258 billion. During FY11–16, India’s exports of processed food & related products (inclusive of animal products) grew at a CAGR of around 12%, reaching US$16.2 billion.

The government is also promoting establishment of specialized agro-processing financial institutions in this sector. Various policy initiatives have been taken by the government of India in order to promote the food processing industry. All the processed food items have been exempted from the purview of licensing under the Industries (Development and Regulation) Act, 1951.

There is automatic approval for foreign equity upto 100% for most of the processed food items except alcohol and beer subject to certain conditions. 100% Foreign Direct Investment is under government approval route for trading, including through e-commerce, in respect of food products manufactured or produced in India.

Excise Duty on food processing and packaging machinery is reduced from 10% to 6%. Over the years, the government has taken other major steps to aid and enhance the agriculture sector with proven farming technologies and supportive policies.

The game changer is the digital technology in farming. The recent evolution of digital technology in farming will further accelerate growth by ensuring higher crop yields and enhancing sustainability by reducing water consumption and the use of agrochemicals.

Digital technologies, such as artificial intelligence (AI) and machine learning (ML), remote sensing, big data, block chain and IoT, are transforming agricultural value chains and modernizing operations.
In September 2021, the Union Minister of Agriculture & Farmers Welfare, Narendra Singh Tomar, announced the initiation of the Digital Agriculture Mission 2021–2025.

Five memorandum of understandings (MoUs) were signed with CISCO, Ninjacart, Jio Platforms Limited, ITC Limited and NCDEX e-Markets Limited (NeML), to forward digital agriculture through pilot projects.
The Digital Agriculture Mission 2021–2025 aims to support and accelerate projects based on new technologies, like AI, block chain, remote sensing and GIS technology and use of drones and robots.

Cisco developed an Agricultural Digital Infrastructure (ADI) solution in August 2019, that enhances farming and knowledge sharing. This ADI is likely to play a vital role in the data pool that will be created by the Department of Agriculture under the National Agri Stack. The pilot project for this initiative will take place at Kaithal (Haryana) and Morena (Madhya Pradesh).

The Jio Agri (JioKrishi) platform launched in February 2020, digitises the agricultural ecosystem along the entire value chain to empower farmers. The core function of the platform uses stand-alone application data to provide advisory, the advanced functions use data from various sources, feed the data into AI/ML algorithms and provide accurate personalised advice. The pilot project for this initiative will take place at Jalna and Nashik (Maharashtra).

ITC has proposed to create a personalized ‘Site Specific Crop Advisory’ service to turn conventional crop-level generic advice into a personalised site-specific crop advisory for farmers, using a digital crop monitoring platform, hosted on ITC’s e-Choupal 4.0 digital platform. The pilot project for this initiative will take place at Sehore and Vidisha (Madhya Pradesh).

The Ministry of Agriculture & Farmers Welfare has developed major digital applications in order to boost technology adoption among farmers:

National Agriculture Market (eNAM): – Launched in April 2016, the National Agriculture Market (eNAM) is a pan-India electronic trading portal that links the existing Agricultural Produce Market Committee (APMC) mandis, to create a unified national market for agricultural commodities. eNAM helps farmers sell products without the interference of any brokers or mediators, by generating competitive returns from their investment

Direct Benefit Transfer (DBT) Central Agri Portal: – Launched in January 2013, the DBT Agri Portal is a unified central portal for agricultural schemes across the country. The portal helps farmers adopt modern farm machineries through government subsidies

In June 2021, The Ministry of Agriculture and Farmers Welfare signed an MoU with Microsoft to run a pilot programme for 100 villages in 6 states. Under the MoU, Microsoft will create a ‘Unified Farmer Services Interface’ through its cloud computing services. This is a major part of the ministry’s future plan to create ‘AgriStack’ – a unified platform to provide end-to-end services across the agriculture food value chain to farmers

Application of Digital Technology in Agriculture

Technological interventions based on remote sensing, soil sensors, unmanned aerial surveying and market insights, etc., permit farmers to gather, visualise and assess crop and soil health conditions at different stages of production, in a convenient and cost-effective approach. They can act as an initial indicator to identify potential challenges and provide options to deal with them in a timely manner.

Artificial Intelligence/Machine Learning (AI/ML) algorithms can generate real-time actionable insights to help improve crop yield, control pests, assist in soil screening, provide actionable data for farmers and reduce their workload.

Blockchain technology offers tamper-proof and precise data about farms, inventories, quick and secure transactions and food tracking. Thus, farmers don’t have to be dependent on paperwork or files to record and store important data.

Implementing these technological solutions enable reliable management and monitoring of farms. As farmers get a complete digital analysis of farms in real-time, they can act accordingly and don’t have to apply excess pesticides, fertilizers and reduce overall water consumption.

Other benefits include: –

Increases agriculture productivity and lowers production cost
Inhibits soil degradation
Lessens chemical application in crop production
Promotes effective and efficient use of water resources
Uplifts socio-economic statuses of farmers
Reduces environmental and ecological impacts
Augments worker safety
Road ahead

As the Indian Agriculture and Allied sector is on the verge of adopting modern technologies, such as IoT, AI/ML and agri-drones for unmanned aerial surveying, Indian and foreign agritech players can play a vital role in supplying these advanced technologies to farmers.

Agritech startup can play a vital role in this endeavour; however, the bottleneck should be removed within the least possible time. If we succeed in this endeavour, this will not only lead to enhance per capita income from the current $1800 to $3600 but also double the income from farming systematically.

Currently, there are few players in the market, but catering to ~267 million farmers in a country exhibits a huge opportunity for private and foreign entities to expand their footprint in the country.

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