The four-pillar approach development agencies must take to transform Indian agriculture

Team Cropin
August 20, 2024
11 min read

Synopsis:

Indian agriculture, despite being the backbone of the economy, faces significant challenges. This blog outlines a four-pillar approach to revitalizing the sector. By focusing on farmer capacity building, financial inclusion, digitization, and robust market linkages, development agencies can empower farmers, boost productivity, and ensure a sustainable agricultural future for India.

Agriculture: the backbone of India’s economy

Agriculture is India’s backbone, supporting millions of livelihoods. According to the Economic Survey, the Indian agriculture sector employed 42.3% of the population and contributed 18.2% to the GDP in 2023-24. Yet, our farmers face a tough reality: low incomes, climate challenges, and uncertain markets. To become a $5 trillion economy, rural India must thrive. Development agencies are implementing a game-changing approach, empowering farmers, bridging the knowledge gap, and opening new market doors. In this blog, we will dive deep into the four key components to build farmer resilience and create a future where agriculture is a path to prosperity.

Type of farmers based on landholdings

The four pillars of agricultural development

As Earth gets warmer, agriculture, food security, and the livelihoods of billions of farmers are threatened. Climate change impacts farming in multiple ways, such as:

Statistical analysis: Statistical techniques are the foundation for understanding data by looking at trends, correlations, and basic patterns.

Geospatial analysis: Specialized tools like Geographic Information Systems (GIS) help analyze data spatially, revealing how agricultural practices and results vary based on location, soil type, and topography.

Machine learning and artificial intelligence: These powerful techniques allow systems to learn from data without explicit programming. They drive applications like predictive yield modeling, crop disease identification, and even the development of autonomous agricultural robots.

Data mining: If you’re looking for hidden relationships within large datasets, data mining is your tool. It can reveal surprising links between farming practices and crop outcomes.

Blockchain: Blockchain technology offers a secure and transparent way to track food products throughout the supply chain and share data among agricultural stakeholders.

Cloud computing: Big Data demands big infrastructure. Cloud computing provides the scalable and flexible platform needed to manage, process, and analyze vast datasets. By eliminating the need for substantial upfront investments in hardware and software, the cloud empowers businesses to focus on extracting value from their data rather than managing complex IT systems.

The benefits of big data: key applications

Let’s take a closer look at some of the most powerful ways Big Data analytics is transforming agriculture:

When seedlings need water, there just isn’t enough rain
When plants need less water, there is too much rain
Seawater intrudes and ruins the crop
When water is less, farmers skip an entire crop cycle
As nights get warmer, plant growth accelerates, compromising grain filling and yields
Shifts in sowing calendars
Pests and diseases further impact agricultural productivity

The climate crisis is particularly distressing for smallholder subsistence farmers cultivating less than 2 hectares of land. These astonishingly efficient and resourceful growers, who account for 78% of India’s farmers, cultivate 41% of our food grain in just 33% of land and are struggling with unprecedented climate change, surging inflation, and numerous external shocks.

As climate change impacts their productive capacity, smallholder farmers need to adapt. Otherwise, they can’t live. But how can they do this? Smallholder farmers are poor and need support, both in financial and technical terms, to implement the changes that will empower them and make them resilient to climate change. According to McKinsey, agriculture could contribute around $600 billion to India’s GDP by 2030 — an increase of 50 percent over its contribution in 2020. But to get there, India must unlock growth and productivity to make agriculture sustainable and enhance farmer livelihood. Development agencies have identified four critical focus areas to unlock agriculture’s full potential:

Now, let’s understand the importance of these four pillars.

Capacity building

At the heart of agricultural development lies the farmer. Capacity building of farming communities has the potential to transform rural livelihoods and foster sustainable agricultural growth. Among the many components of capacity building are farmer engagement, comprehensive training, driving skill development, and enabling knowledge sharing so that farmers practice modern agriculture and adopt the ideal package of practices for specific crop varieties. Since farmlands in India are very remote and spread over 20 kilometers, it is highly challenging for farmers to acquire the required knowledge. Leveraging technologies like agri-specific cloud platforms can make capacity building and farmer engagement easier. By providing farmers access to relevant knowledge, best practices, and expert advice, we can enhance their decision-making abilities and boost productivity.

Financial inclusion

Smallholder farmers account for 85% of the nation’s farmers in India. They often need more access to financial services to invest in critical seasonal inputs. The percentage of marginal farmers with access to finance is difficult to quantify, and according to some estimates, access to credit from the formal banking sector for smallholder farmers is below 20%. Financial inclusion empowers farmers by providing them with the necessary resources to purchase quality inputs, adopt new technologies, and withstand shocks like crop failures, helping farmers protect themselves and develop resilience. Farmers need financial assistance to adopt sustainable agricultural practices. Development agencies like the World Bank support farmers financially. However, the bottleneck for them in this regard is to ensure the funding goes to the right farmer and the farmer is utilizing the financing for the program’s objective. To put this into perspective, about 30-40% of credit funds set aside under the interest subvention scheme were diverted to non-agriculture purposes like healthcare expenses, education, and marriage.

Market linkages

A farmer’s income is realized only after a successful sale of a good harvest produced. They must get fair prices for their produce, which, unfortunately, is a struggle for many farmers due to various constraints, including

We can help farmers access profitable markets by creating efficient market linkages and offering market intelligence. Support needs to be provided through the creation of efficient value chains, improved post-harvest management, and actionable market intelligence.

Digitization

Agriculture is undergoing a digital revolution. Today, technology is reshaping how we grow, manage, and distribute food. Modern agriculture goes beyond the use of mechanization like tractors; it’s about data, insights, and precision. Tools like drones, sensors, and AI are transforming crop monitoring, optimizing resource utilization, and predicting risks. This shift to digital farming is essential for farmers to develop resilience. Development agencies are driving this transformation to maximize their impact. By harnessing technology, development agencies collect data more efficiently, understand farmers’ needs better, and allocate resources where they’re needed most. Ultimately, technology is vital to connect with the key stakeholders – the farmers- and to educate, engage, empower, and enable them.

Through concerted efforts in these areas, development agencies work to support farmers in adapting to climate change, increasing their incomes, and contributing to India’s economic growth.

Overcoming the hurdles: agtech as the enabler

While these four pillars form the foundation of agricultural development, effectively implementing them is fraught with challenges. Agtech offers a promising pathway to overcome these hurdles.

By leveraging technology, development agencies can enhance their impact and accelerate agricultural transformation.

Farmer engagement

Mobile apps, SMS-based advisory services, and online platforms can connect farmers with extension agents, disseminate agricultural information, and foster knowledge sharing.

Financial inclusion

To improve farmers’ access to finance, creating a digital footprint, inclusive financing, mobile banking, and agricultural insurance are vital.

Digitization

Digitization creates farmers’ digital footprints and can be leveraged to share advisories to mitigate risk and reduce losses. Precision agriculture technologies, remote sensing, and IoT devices can help farmers optimize resource use, monitor crop health, and predict weather patterns.

Market linkages

E-commerce platforms, market intelligence tools, and supply chain management systems can connect farmers with buyers, reduce post-harvest losses, and ensure fair pricing.

Case studies

Empowering african farmers with digital solutions

The Cropin and Alliance for a Green Revolution in Africa (AGRA) partnership is transforming African agriculture by empowering smallholder farmers through agripreneur model of capacity building. It has reached over 2 million farmers across six countries. By leveraging technology, a network of agripreneurs was developed to provide essential support and knowledge to farmers. Cropin Cloud platform enabled knowledge dissemination and provided weather insights, alerts and advisories. Together, we’re building a resilient and sustainable agricultural ecosystem in Africa with a mission of 20 million happy farmers by 2025.

This project was all about the empowerment of smallholder farmers. Here’s the impact:

2.197 million farmers: Reached and equipped with the knowledge to thrive
8,016 VBAs: Trained and transformed into local agri-preneurs
Increased productivity: Better practices led to higher yields and income for farmers
Climate-smart practices: Farmers learned to adapt to changing weather patterns

Transforming rural livelihoods with technology

Collectives for Integrated Livelihood Initiatives (CInI), an associate organization of Tata Trusts, in partnership with Cropin has successfully empowered rural-tribal communities in Central India. With the aim of improving the income of 101,000 households to Rs 120,000 per annum or more from Rs 40,000, Tata CinI leveraged technology. Digitization ensured farmers had digital records, data collection was eased, field staff visibility improved, advisories on weather and a package of practices were shared with farmers, and input resource usage was monitored.

CInI has facilitated a significant increase in farmer incomes, with 84% of beneficiaries reporting improved quality of life. This transformative project demonstrates the power of technology in driving rural development and achieving sustainable livelihoods. Here’s the impact:

Enabling market linkage & financial inclusion

The National Bank for Agriculture and Rural Development (NABARD) collaborated with the Government of Karnataka and Cropin to implement a project to digitize farming. The project provided support and advice to smallholder farmers across twenty-nine districts of Karnataka.

Smallholder farmers were neck-deep in debt due to:

Lack of knowledge of climate-resilient agricultural practices
Absence of input resources management options
No access to modern production, harvest, and post-harvest technologies
Lack of real-time market linkages (such as prices) and access
Need for transparent price discovery mechanisms
Credit support

Cropin digitized these farmers and farms, shared a standard package of practices (PoP), and offered intelligent advisories. It connected farmers to Agri-input companies digitally, which helped them get fair prices for seeds, fertilizers, and pesticides. Farmers’ produce received competitive prices supported by transparent price discovery mechanisms. Lending institutions benefitted from credit risk assessments and farmers’ creditworthiness, which eased the disbursal of agricultural loans across Karnataka.

The Four-pillar Approach Development Agencies Must Take to Transform Indian Agriculture

Here’s the impact:

The Four-pillar Approach Development Agencies Must Take to Transform Indian Agriculture

Agriculture: catalyst for global development

Farming feeds the world and fuels economies. Its impact on lifting people out of poverty is unparalleled, with growth in this sector proving two to four times more effective than other industries. We need to rethink agriculture to achieve global development goals where everyone has enough to eat and farmers prosper. Combining traditional wisdom with cutting-edge agricultural technology can unlock agriculture’s full potential to drive economic growth and improve lives. By leveraging technology, development agencies are creating a more inclusive, sustainable, and profitable agricultural sector. They empower farmers with knowledge and tools, drive financial inclusion, and improve market access to build a resilient food system that benefits farmers and consumers.