Last week, a report by Bain & Co. said the Indian e-commerce market grew by 25% to reach USD 38 billion in the financial year ending March 2021. It went on to project that the industry would touch USD 140 billion over the next five years.
“Small-town India will fuel this growth, accounting for four out of every five new shoppers,” they said.
A part of this new growing user base is farmers in the country, who turned to the internet to buy seeds, pesticides, and other farming ingredients during the lockdowns imposed last year to curb the spread of COVID-19.
Although it might seem like a small target audience with lower purchasing power, the farming community may make up for a market with potential. For context, India’s official farmer population stands anywhere between 100 million and 150 million. A growing number of local startups are tapping this segment to not only sell them farm inputs but also to create an entire ecosystem, where they will help farmers grow their produce and enable them to sell crops as well.
Last year, when India was under months of lockdown to curb the rising infections of COVID-19, the majority of farmers had no way of going to the market to buy farming ingredients. Surendra Prasad, a cauliflower farmer from a village in the North Indian state of Bihar, was one of them. His teenage son then discovered multiple online platforms such as Agrostar, BigHaat, DeHaat, and Gramophone that could help his father get hold of the products he needed to farm.
The local agritech companies, which sell farm inputs like pesticides, fertilizers, seeds, and farming equipment online, have been seeing a rise in demand since the pandemic. Earlier, they had to employ salespeople who would visit these farmers to help them place orders from their phones.
But when these sales executives couldn’t travel to the farms due to the lockdown, agritech companies started seeing farmers like Prasad placing orders themselves, albeit with some help.
“Due to lockdown, when farmers’ access to local retailers was limited, they started looking up online, discovered BigHaat, and started placing orders themselves,” Sachin Nandwana, CEO and founder of BigHaat, told KrASIA.“During May last year, we witnessed 80% growth in our business. Compared to 2019, our growth quadrupled.”
Due to COVID-19, the country’s USD 370 billion agriculture sector has observed a complete transformation that is expected to continue in the coming years.
What Does It Mean
The agritech sector in the country has been growing exponentially and is projected to grow to a USD 30 billion–USD 35 billion market by 2025, according to a study by Bain & Co. The report said online sales of produce, farming inputs, and logistics are going to be the key drivers for the sector.
Many agritech startups are looking to create an end-to-end platform for farmers to source information on weather, soil, and crops; buy farm input products; and sell their produce, among other things.
For instance, BigHaat is planning to go into a full-stack model to provide inputs to farmers, guide them throughout their farming process, and buy back crops in the end.
Apart from e-commerce, BigHaat provides farmers with value-added services such as agri-news, a communication forum called Kisan Vedika, and a platform called crop doctor, which allows farmers to upload the photo of their infected crops to seek help from experts and peers.
“Of half a million monthly visitors, most of them use features like crop doctor and Kisan Vedika. We aim to make farmers realize the importance of technology and how it can be easily harnessed to directly benefit them,” says BigHaat’s Nandwana.