NEW DELHI:Startups and venture capital are pouring into what might seem an unlikely place: India's vast, outdated agriculture industry.
Seizing on controversial new deregulation, entrepreneurs are selling farmers apps to connect them to big buyers nationwide and using artificial intelligence (AI) to improve the rickety supply chains that lose one-fourth of India's produce to wastage.
Enormous amounts of India's grain, fruit and vegetables rot between farm and table because of manual handling, repeated loading and unloading, poor inventory management, lack of adequate storage and slow movement of goods. This rate of wastage from faulty supply chains is four to five times that of most large economies, experts say.
Prime Minister Narendra Modi's government introduced changes it calls a watershed that will "remove middlemen and let farmers sell their produce directly to buyers," improving their prospects, especially in far flung areas.
Modi's September overhauls, potentially the biggest reform ever to India's massive farm economy, let farmers sell to institutions and big retailers such as Walmart, not just to regulated wholesale markets.
But farmers fought back with disruptive national protests and Modi lost a cabinet minister from breadbasket state Punjab over concerns that the deregulation might endanger government-guaranteed minimum prices for produce.
The farm sector contributes nearly 15% of the output of India's $2.9 trillion economy and employs around half its 1.3 billion people.
HIGH-TECH SPUDS
Producers and buyers are looking for business, helped by high-tech gear backed by big investors.
Some 85% of India's farmers own less than 2 hectares (5 acres) of land and lack the means to sell beyond local markets, even if that means forgoing better prices.
Potato farmer Rakesh Singh in Uttar Pradesh said he is keen to get computer-enhanced tools to help his business in India's most populous state.
"Real-time prices available on live electronic trading platforms and easy-to-use trading apps for mobile phones make the process of price discovery and selling goods a transparent and hassle-free experience for us," he told Reuters.
Singh is looking forward to a trading app from Farmpal Technologies Pvt Ltd, a small firm based in western Maharashtra state, targeting heartland states with technology that connects producers directly with retailers, its software predicting market conditions and managing inventories accordingly.
"As a two-year-old startup, we've seen the transformative nature of AI, which drastically reduces food waste and helps farmers get better prices, and buyers get better quality with a predictable supply chain," said Farmpal founder Puneet Sethi.
Affordable mobile phones and ultra-cheap data make it easier for farmers to go electronic.
Mark Kahn, managing partner of Omnivore Capital, a venture capital firm that funds farm-tech companies, estimates $1 billion will flow into India's agritech sector each year with startups growing 20% to 30% annually.
"The new law will have an immediate impact, and there is going to be a spurt in agritech startups," Kahn said.
Sequoia Capital and Tiger Global have also funded agritech startups that aim to run the entire food supply chain.
Some firms will develop AI tools for assaying and warehousing, others will offer electronic platforms to connect farmers with mom-and-pop stores and large retailers.
Digitising the supply chain will generate data that firms will use to gauge demand, crop size and new season arrivals, said Farmpal's Sethi.
Nukul Upadhye, co-founder of Bijak, another startup, said: "We provide farmers with a data set of good, reliable buyers from far-off places willing to pay a premium for the produce of their choice and quality. That way, we help both farmers and their buyers."
But some growers, like Singh, will also continue to rely on existing markets that offer a level of protection.
"I don't have 100% control over the quality of my crop, which will always be vulnerable to bad weather," he said. "I know that agritech companies will reject my crop if it doesn't meet their rigid quality standards."
Reuters
Thu Nov 12 2020
A farm worker harvests maize crop in a field on the outskirts of Ahmedabad, India. REUTERSpic
Astro AWANI's revamped English news website, AWANI International, launches on Oct 21
Astro AWANI's revamped English platform delivers in-depth global news and expert analysis to keep you informed on key developments.
Israeli strikes kill 33 people in Jabalia refugee camp in Gaza, medics say
Residents of Jabalia said Israeli tanks had reached the heart of the camp after pushing through suburbs and residential districts.
Liam Payne's ex-partner calls for media restraint after 'painful' death
Cheryl Tweedy used her statement to urge the media to remember they had a seven-year-old son, Bear, who could read the reports.
Analysts: Indonesia's strong MoF leadership team to boost investor confidence
Sri Mulyani Indrawati as head of Indonesia's Ministry of Finance is expected to instil confidence among investors.
Biden offers both a carrot and a stick to Israel as his term nears an end
Israel has frequently resisted US advice and has caused political difficulties for the Biden administration.
Putin says BRICS will generate most of global economic growth
Russian President Vladimir Putin will host a summit of the group in the city of Kazan on Oct. 22-24.
ISIS Malaysia's perspective of Budget 2025
An excellent rakyat-centric budget under the overarching principle of a caring and humane economy.
Budget 2025: Record increase in STR, SARA aid initiatives
The government will provide a significant boost to the Sumbangan Tunai Rahmah (STR) and Sumbangan Asas Rahmah (SARA) initiatives next year.
Budget 2025: EPF contributions to be made mandatory for foreign workers – PM Anwar
The government plans to make it compulsory for all non-citizen workers to contribute to the Employees Provident Fund (EPF).
What policies to expect from Indonesia's new President Prabowo
Prabowo will be open to foreign investment, his aide has said, such as by offering investors management of airports and sea ports.
Budget 2025: Govt allocates RM470 mil to empower women's participation in PMKS
The Women's Leadership Apprenticeship Program will be intensified as an effort to produce more female corporate personalities.
Israel sends more troops into north Gaza, deepens raid
Residents of Jabalia in northern Gaza said Israeli tanks had reached the heart of the camp, using heavy air and ground fire.
Indonesia ramps up security ahead of Prabowo's inauguration
Prabowo Subianto will be sworn in as Indonesia's president on Sunday with Vice President-elect, Gibran Rakabuming Raka, also taking office.
Immediate allocation of RM150 mil for local authorities, DID to tackle flash floods
Datuk Seri Anwar Ibrahim said this allocation is intended to address the recent flash floods that hit the capital and several major towns.
Budget 2025: Sabah, Sarawak to continue receiving among highest allocations - PM
Sabah and Sarawak continues to be prioritised under Budget 2025, with allocations of RM6.7 billion and RM5.9 billion respectively.
NFOF will be operational in November 2024 with funding of RM1 bil
PM Anwar Ibrahim said NFOF will support venture capital fund managers to invest in startup companies with RM300 million set aside for 2025.
Minimum wage to increase to RM1,700 effective Feb 1, 2025
The Progressive Wage Policy would be fully enforced next year with an allocation of RM200 million, benefiting 50,000 workers.
Bursa Malaysia ends higher on Budget 2025 optimism
The benchmark index, which opened 1.85 points higher at 1,643.29, moved between 1,641.71 and 1,649.31 throughout the trading session.
Five important aspects relating to people’s lives in Budget 2025 - PM
The focus is on driving the MADANI Economy, speeding reforms, cutting red tape, raising wages, and tackling the cost of living.
Economic outlook: Govt plans to leverage, expand existing city transit system
The expansion aims to provide a more efficient and reliable public transportation network, reduce congestion, and improve accessibility.