By 2030, India will have a freshwater shortfall of about 50 percent. Agriculture accounts for 78 percent of the country’s water use and irrigation innovation will be key to meeting the demand for water and food in the future. However, currently, it is difficult for agtech startups to find investors because of the uncertainty of the agtech landscape. In order to link new technologies to funding, the startup trends and business landscape need to be illuminated.
In their new report, DWFI Program Research Manager Ankit Chandra and Director of Policy Nick Brozović highlight key emerging trends for agtech startups in India. Trends include transitions from hardware sales to software sales and services; bundling with other agricultural products and vertical integration; and varied partnerships to reduce customer acquisition costs. With increased global focus on the use of data to add value for irrigating farmers, they expect domestic and international growth opportunities for Indian startups that can leverage partnerships to scale quickly.
In a follow-up report, Chandra and Brozović provide an in-depth analysis of several agtech business models. The report provides insights into the larger business landscape of agricultural water use in India with a detailed ecosystem map (a visual representation of a system that highlights relationships in a particular context), and capital investments flowing within the sector.
“Investments in sustainability and climate mitigation solutions are increasing, and irrigation tech innovations align well with these trends,” said Chandra, in an interview with Business Today, India's largest circulated business magazine. “We believe that as more agritech start-ups focused on water management frame their business models in the context of climate change and sustainability, it could potentially attract more VC [venture capitalist] investment.”
The reports were well received and shared widely through large agribusiness channels in India. In June 2023, Chandra traveled to India to speak, collaborate and strengthen partnerships with The World Bank, The Nudge Institute, irrigation companies and several agtech startups. An outcome of his trip was a partnership with The Nudge Institute on DCM Shriram AgWater Challenge, which encourages feasible irrigation solution ideas for smallholders in India. The AgWater Challenge is a year-long competition that intends to build a cohort of 15 agtech startups and an ecosystem of actors and organizations focused on water management in agriculture for smallholder farmers. As a partner, DWFI will assist through the selection process and provide mentorship and guidance to finalists.
The reports shed light on the current and future agtech industry in India, helping to reduce risk of potential investors. By fostering global entrepreneurship and advancements in technology and irrigation, DWFI is achieving its mission of influencing the adoption of technology and best practices to improve water use in agriculture and address global water security concerns.
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