Indian agriculture, long considered the backbone of the country’s economy, is now transitioning into a new era. This new age is defined by agritech — technology-driven solutions that are making farming more productive, sustainable, and profitable. While over 70% of India’s rural population still depends on agriculture for their livelihood, the sector faces several challenges — climate change, low literacy rates, and declining productivity among them. In this context, agritech startups are stepping up to transform Indian agriculture.
This article explores the current state of India’s agritech revolution, its impact, and future potential.
Current Status of India’s Agritech Industry
Agriculture contributes around 16.5% to India’s GDP, making it a cornerstone of the country’s economy. In 2022, the Indian agriculture market was valued at USD 435.9 billion, and is projected to grow to USD 580.82 billion by 2028, at a CAGR of 4.9%.
As for the agritech market specifically, an Avendus report estimates that it will surge from USD 4 billion in 2022 to USD 34 billion by 2027 — an 8-fold increase. Notably, the food crop segment alone is expected to rise from USD 3 billion to USD 25 billion by 2027. Other segments such as fibre crops, livestock, dairy, poultry, and fisheries are also on a high-growth trajectory.
As of 2022, India had over 450 agritech startups, growing at an annual rate of 25%. While the total addressable agritech opportunity is estimated at USD 24 billion, market penetration is currently less than 1% — highlighting immense potential for new ventures and expansion of existing ones.
Contributions of Agritech Startups to Indian Agriculture
India’s agritech startups are redefining conventional farming by offering innovative solutions that are transforming farmers’ lives:
Precision Farming: By using drones, sensors, and satellite data, farmers can now optimise land, water, and fertiliser usage, leading to higher crop yields.
Digital Marketplaces: Mobile apps are directly connecting farmers to markets, reducing reliance on intermediaries and helping them get better prices.
Crop Health & Weather Insights: Real-time alerts and weather forecasts enable timely decisions, minimising the risk of crop failure.
Credit & Insurance Access: Fintech-backed agritech platforms are offering easier access to loans and insurance, helping farmers reduce financial risks.
Storage & Logistics: Startups are providing modern cold storage, tracking, and transportation solutions, significantly cutting post-harvest losses.
Government Support & Policy Initiatives
The Indian government is actively supporting the agritech sector through various policies and schemes:
e-NAM: Launched in April 2016, the Electronic National Agriculture Market (e-NAM) aims to digitally integrate APMCs to create a ‘One Nation, One Market’ system. This ensures fair pricing, transparency, and better market access for farmers.
Budgetary Allocations: For 2025–26, the Ministry of Agriculture & Farmers’ Welfare has been allocated Rs 1.37 lakh crore, representing 2.7% of the Union Budget, which indirectly supports agritech startups.
Make in India & Aatmanirbhar Bharat: These flagship initiatives are promoting agritech innovation by encouraging indigenous technology development.
Digital Agriculture Mission: Approved on September 2, 2024, this mission has a budget of Rs 2,817 crore, with Rs 54.972 crore allocated for 2025–26. The aim is to drive technology adoption in farming.
Agritech’s Growing Impact, but Challenges Remain
According to the World Economic Forum, the number of agritech startups in India increased from just 43 in 2013 to over 1,000 by 2020. One major driver of this growth has been the increasing internet penetration in rural India.
Armed with technologies like AI, machine learning, and IoT, these startups are reshaping the future of Indian agriculture. However, the transition is far from easy. As per an Ernst & Young report, agritech had only 1% market reach in 2020. While tech adoption spiked during the pandemic, reaching every corner of rural India remains a significant challenge.
What’s in it for Investors?
The agritech sector presents a huge opportunity for investors. Despite a potential market size of USD 24 billion, current usage is still under 1%. In 2022, Indian agritech startups raised USD 817 million, a strong indicator of momentum.
Initiatives like the Digital Agriculture Mission and e-NAM are creating a conducive ecosystem for innovation. However, the sector currently has few established players, and none of the startups are listed yet — leaving room for early-stage investment and long-term growth.
What’s Next?
According to McKinsey, Indian agriculture could contribute USD 600 billion to the GDP by 2030 — a 50% jump from 2020 levels. Super apps, agri-fintech platforms, and large tech companies are driving this transformation and setting the stage for rapid growth.
Meanwhile, the UN World Population Prospects 2024 report projects that the global population may reach 10.3 billion by the 2080s. As the most populous nation already, India is poised to play a key role in global food security.
To seize this opportunity, collaboration is essential — between the government, startups, and farmers. Key areas of focus include increasing digital literacy, making technology more affordable, and strengthening rural infrastructure.
*This article is for informational purposes only. This is not investment advice.
*Disclaimer: Teji Mandi Disclaimer
