The agriculture industry in India reached a value of INR 49,997 Billion in 2018. The market value is further expected to reach INR 99,927 Billion by 2024, exhibiting a CAGR of 11.8% during 2019-2024. The agriculture industry represents an important component of the Indian economy both in terms of its contribution to the GDP as well as a source of employment to the majority of the country’s population. This sector is currently showing immense opportunities, with India presently being one of the world’s largest agricultural producers by value. A number of transformations have taken place in this sector over the past few decades. These include - rising penetration of the organized sector, growth in contract farming, agriculture becoming more mechanized, easy loan facilities, rise of exports, use of agrochemicals and high yielding seeds, and an increasing role of the private sector in processing, branding and marketing, etc.
Indian Agriculture Industry: Market Drivers
- India is the second largest populated country accounting for 18% of the total world population. With an increase in the population, the need for various agricultural products has increased significantly. This rise has prompted the farmers to adopt enhanced technologies and methods in dairy, fisheries and livestock in order to meet the diversified food needs of the people. Additionally, more than 50% of India’s population is dependent on agricultural products which is further promoting the growth of the market.
- Over the past few years, India’s GDP has been growing at a steady pace which has resulted in a rise in the disposable incomes of the consumers. This rise has driven the agriculture market both in terms of the producer and consumer. It has enabled farmers to invest more in advanced agricultural infrastructure such as irrigation facilities, quality seeds, equipment’s, fertilizers, warehousing, cold storage, etc. It has also increased the consumers purchasing power creating a positive impact on the domestic demand of agriculture products.
- India represents one of the most bio-diverse countries in the world. The country encompasses various types of climatic conditions and soil types suitable for cultivating a large number of cereals, fruits, vegetables, flowers, cash crops, etc. The Indo-Gangetic plain, for instance, represents one of the most fertile lands across the globe. In addition, India also represents the second largest fish producing country in the world. The country has diverse resources ranging from deep seas to lakes in the mountains and more than 10% of the global biodiversity in terms of fish and shellfish species.
- Government support plays a vital role in the growth of the Indian agriculture sector as agriculture remains a primary means of livelihood for more than 50% to 60% of the India’s total population and as such represents the most important vote bank for any government. The Indian government is providing subsidies to farmers on water, power, agricultural equipment, fertilizers, hybrid seeds, etc. The Government has also exempted agriculture income under the Indian income tax act, meaning income earned from agricultural operations is not taxed. Moreover, both state and central government often waive off loans given to farmers.
- The introduction of contract farming has also created a positive impact on the agriculture industry. Contract farming reduces the load on the central and state level procurement system by increasing the private sector investments in agriculture. It also provides more exposure to the farmers to world class mechanized technology related to agriculture.
- The emergence of modern retail has also been an important catalyst for the agriculture industry. Modern retail helps in the elimination of middle men from the distribution chain, thereby providing better remuneration to the farmers. Organized retail enables the farmers to directly sell their produce to modern organized retail networks, thereby helping them to get a better price as compared to small-scale local vegetable markets. These retailers have also started signing supply agreements with various farmers which further assures them of a minimum income. Moreover, these agreements help farmers in reducing wastage, transportation costs and providing fresh supply of food items to the consumer.
- The establishment of rural banking and credit system has also played a pivotal role in the growth of the agriculture industry. The transformation of agriculture from subsistence to commercialisation requires investment on the farm along with the use of modern inputs. With the availability of credit, the constraint on certain inputs like seed, fertilizer, pesticides, hired labour, etc. has been reduced.
This new report from IMARC Group entitled “Agriculture Industry in India: Growth and Opportunities” provides an exhaustive insight into the Indian agriculture industry along with its various segments and sub-segments. This report has divided the Agriculture Industry in India into 17 segments and has provided a thorough analysis for each segment such as current and historical market trends, drivers, challenges, market structure, competitive landscape, market forecast, etc. This study is a must-read for investors, manufacturers, consultants, researchers, marketing strategists and anyone who wants to get a deeper insight into the agriculture industry in India.
Key Questions Answered:
- What has been the performance of the farming industry in India?
- What has been the performance of the fertilizer industry in India?
- What has been the performance of the pesticide industry in India?
- What has been the performance of the food processing industry in India?
- What has been the performance of the dairy industry in India?
- What has been the performance of the flower industry in India?
- What has been the performance of the silk Industry in India?
- What has been the performance of the honey and beeswax industry in India?
- What has been the performance of the fish industry in India?
- What has been the performance of the poultry industry in India consisting of eggs and broiler meat?
- What has been the performance of the warehousing industry in India?
- What has been the performance of the cold chain industry in India?
- What has been the performance of the seed industry in India?
- What has been the performance of the agriculture equipment industry in India?
- What has been the performance of the animal feed industry in India?
- What has been the performance of the bioagriculture industry in India?
- What has been the performance of the animal husbandry industry in India?