Farm Mechanisation using EV to improve the overall GDP of the country

Kaustubh Dhonde, Co-Founder & CEO, AutoNxt Automation (1)

by Kaustubh Dhonde, Founder and CEO of AutoNxt Automation,

The agriculture market of India reached a value of about INR 55,994 billion in 2020. The Indian market is expected to grow at a CAGR of nearly 12% from 2021-2026 to reach a value of roughly INR 111,916 billion by 2026. The agricultural sector is an important part of the Indian economy in terms of its GDP contribution. For the majority of the nation’s population, directly or indirectly it is a source of employment. This sector has brilliant growth opportunities now, with India already being one of the largest agricultural producers globally. Currently, India is the third-largest agricultural producer globally in terms of value, after China and the United States.

India is one of the largest populated nations, with nearly 20% of the global population, which gives an excellent growth opportunity for the agricultural sector in the country. As the population has grown the demand for various agrarian commodities has grown considerably. This growth has led farmers to introduce improved techniques and methods in fishing, milk, and livestock to meet people’s various food needs. There have been a variety of changes in this field over the last couple of decades. These involve growth in contract farming, increased organized sector penetration, mechanized agriculture, easy loan facilities, agrochemicals, increased exports, and high-yield seeds, and the growing role of the private sector in manufacturing, branding, and marketing, among others. These factors are aiding the powerful growth of the agriculture market in India

Agriculture refers to farming, which includes the raising of food and other crops, along with the rearing of animals to provide the utilities like food, wool, and other necessary products. The major regional markets in the agriculture market in India are Karnataka, West Bengal, Uttar Pradesh, Orissa, and Maharashtra, among others.

The rise in population has led farmers to execute improved technologies and methods in fishery, milk, and livestock to meet people’s diverse food needs, which is moving the Indian agriculture market. Almost half of the population of India is also reliant on agricultural goods, which further promotes market growth. India’s GDP has increased regularly, increasing the consumer’s expendable income. This growth has powered both the consumer as well as producer demand in agriculture. Farmers have invested more and will increasingly invest in advanced farm infrastructure, including irrigation, machinery, quality seeds, stocks, fertilizers, cold storage, etc. The purchasing power of consumers has also increased so much, which is having a positive effect on the domestic demand for agricultural products.

Since agriculture stays the primary livelihood of more than half of the overall population of India, Government aid plays an important role in the development of the Indian agriculture sector, making it the biggest voting bench in the country. The Indian government provides farmers with subsidies for electricity, water, fertilizers, farm machinery, hybrid seed, and so on. The government has also spared farm income in accordance with the Indian Income Tax Act, which means that farm operations’ income is not taxable. This has further aided the development of the agriculture market in India

Let us take an example of the Korean Agricultural Machinery Industry which had been in very poor condition before the 1950s, mainly due to the Korean War. The agricultural sector, the largest sector of the population, was also depressed. Until this time, most agriculture depended on existing, traditional methods. The hope for agricultural mechanization started with the placement of domestically produced power tillers during the 1960s. The Korea Agricultural Mechanization Program started in earnest throughout the 1970s after a learning period during the 1960s.

The driving force of this program was mainly attributed to fast industrialization at that time. As industrialization was occurring, many farm workers were moving into cities, resulting in a severe shortage of manpower in farming districts. To accelerate industrialization by utilizing the rural workforce, the government actively promoted the Agricultural Mechanization Program. A long-term vision of this program was made by the establishment of the 1978 Agricultural Mechanization Promotion Act. Since then, the program has led farming villages to modernization by producing and distributing new machinery with cutting-edge technologies. This program suffered a long-term price freeze in the 1980s along with fastly changing agricultural situations at home and abroad; despite this, the program has been evaluated as a successful model.

Korea has a good after-sales service system for agricultural machinery compared with many other countries. In Korea, each center located in Myeon has after-sales services for small troubles of agricultural machinery, and in case of larger problems, like transmissions and engines, after-sales service centers in each Gun fix them. Repair centers operated by agencies of manufacturers in each Do (or Province) deal with serious problems with agricultural machines. This system is necessary for large agricultural machinery like tractors in Korea. Taking this example from Korea, even our agrarian country should implement similar Agriculture Mechanization Promotion Acts. After looking at the on-ground scenario of farms, just like White Revolution, India needs a “Grey Revolution” (Robotic and Automation revolution) starting from mechanization in Agriculture, helping the population produce food more efficiently, to be able to meet the expected demand in the coming years.