The Agriculture of India’s Tomorrow
Sep. 26, 2018
We don’t have a crystal ball to gaze into the future, so it is hard to accurately predict how the Agriculture of India’s tomorrow could look like. But based on his deep understanding of the space, Siva Sivakumar, Chief Executive — Agri Businesses at ITC Limited, decided to take an alternative approach to try and predict the future by listening to key stakeholders of the Agritech ecosystem and understand what drives them, what their concerns and aspirations are.
Sivakumar worked with a farmers’ cooperative for six years before joining ITC in 1989. He currently oversees Agri and IT Businesses of ITC. The e-Choupal initiative, linking the farmer via the internet, was developed and executed under his leadership. Sivakumar is also the Chairman of the National Agricultural Council of the Confederation of Indian Industry (CII), Vice Chairman of the World Economic Forum’s Global Agenda Council on Social Innovation, and has served on the Boards of India’s National Bank for Agriculture and Rural Development (NABARD), and Indo US Knowledge Initiative on Agriculture, UN Global Compact’s Core Advisory Group to develop Sustainable Agriculture Business Principles among others.
At Kalaari Capital’s event, #ThePromiseOfAgritech, Sivakumar spoke about three important stakeholders in the Agritech ecosystem — end consumers, farmers and the society at large and gave a perspective into how this space could develop 7–10 years from now.
1. What End Consumers want
There is a great need to produce food in large quantities to feed the global population, but just quantity is not enough. We have to take care of taste too as consumers see it as one of the most important aspects when making a purchasing decision.
Once consumers are assured of quantity and taste, food safety and hygiene comes into the picture. They want to know what kind of chemicals have been used in growing the food and what kind of residues are remaining.
Nutrition is the final criterion under consideration. Siva described it as the ‘hidden hunger’. Food may be offered at lower prices to people who can’t afford it, but is the nutrition content in that food sufficient for overall well-being? End customers also want all the above requirements at the lowest and most competitive prices possible.
2. What are farmers looking for?
While end consumers want the lowest possible prices, farmers have a diametrically opposite expectation- Highest possible income. In the past, farmers would see their produce get auctioned at Mandis. They would put over 100 days of effort and not really know how much they would earn for their efforts. Hence there was a great need to bring about price standardisation in the market so that farmers could better plan and predict their income in advance.
Many startups, conglomerates and even local and central governments have been working towards this end of increasing farmer incomes. The Indian government recently announced that it had allocated Rs 2.12 lakh crore to achieve its objective of doubling farmer income by 2022.
Because of the lack of resources, many farmers rely heavily on rains as a source of water for their crops and are hence at the mercy of the weather, which can be quite unpredictable. Apart from price fluctuations and weather, the dignity of labour is another factor affecting farmers.
Sivakumar discovered that farmers push their children to pursue others careers because of the lack of dignity in labour. This is true even for relatively well-off farmers(who have had only one bad year in the last decade or have higher than average incomes). The dignity of labour is not limited to only the difficulties in selling but extends to the entire value chain.
Amenities like education, health care that we take for granted are still aspirations for most farmers.
3. Society at large
It is estimated that India as a country is more starved than the rest of the world. Sivakumar noted that while the third stakeholder, society at large, includes consumers and farmers it mainly represents the poor that struggle to have one proper meal per day. This section of society is generally not able to air their concerns with relevant authorities because they don’t know how to or because of inefficiencies in the agriculture ecosystem.
Hence there is a great need to solve for macro needs of society at large and also those of farmers and end consumers. If we are building for tomorrow how do we translate these multiple data points into real world solutions? Based on current progression, Sivakumar believes that this is what Indian Agritech could look like-
1. Farms as factories
Sivakumar sees a future where precision farming and climate resilient farming will become a norm as farms transform into factories of sorts and will be able to produce crops on a massive scale.
For example, with drought resilient seeds, farmers will be able to produce crops irrespective of external weather conditions. In a similar manner, climate controlled environments like greenhouses could also provide ideal conditions for crop growth.
2. Homes as farms
A new trend that has kicked off in recent times is having a ‘Home farm’ with kitchen gardens serving as a platform for cultivation. From a sustainability perspective, one has full control over the lifecycle of crops. Concerns like what pesticides are used, vanish in this setup.
But time, space and management is an issue for many. So, community gardens, where people manage a garden together or outsource to an expert is also gaining popularity. In the above cases, communities are generally looking to consume what they produce and not sell their crops. So self-sufficiency is the focus.
Another hyperlocal solution is when an intermediary connects small farms to communities that are nearby(a few km away) and helps them source local produce.
3. Agriculture will go back to basics
Sivakumar sees agriculture going from mono-cropping, the current mainstream practice of cultivating individual crops, to poly-cropping and integrated farms. Pisciculture, animal husbandry, beekeeping and other activities are practiced in tandem with cultivating a variety of crops. The benefit here is that the ecosystem, which is called permaculture, becomes self-sufficient and costs and risks go down in the long run. However, the challenge is that farmers running integrated farms need to have an in-depth understanding of multiple disciplines, which isn’t easy. But there is an enormous opportunity for technology to support farmers.
Sivakumar believes that we are at an inflection point in the Agri-Tech space in India. There is access to affordable technology, large-scale public data sets and an openness among the farmers to embrace new solutions. Multiple start-ups and corporates are also working to narrow the divide between farmers and end consumers, so that the entire ecosystem flourishes. He concluded,
“There is no better opportunity than Indian agriculture to do good and be good.”