As a part of a series of press conferences around India’s $267Bn COVID-19 economic stimulus package, Finance Minister Nirmala Sitharaman announced an interesting new fund. The announced fund, with a size of $13.2 Billion and focused towards upgrading India’s outdated agricultural infrastructure, could prove to be a boon for India’s agri-tech startups.
Sitharaman, in her third COVID-19 economic stimulus package, announced a mega $13.2 Billion (~₹1 Trillon) agri infrastructure fund. This fund’s primary focus would be to rapidly modernise India’s agricultural infrastructure, along with logistics and supply chain bottlenecks. Apart from upgrading cold chain and other storage infrastructure, the fund will focus on upgrading logistics and supply chain related infra.
More interestingly, the finance minister categorically stressed, that this newly created infrastructure would be provided to agri entreprenuers and startups, who can build high tech solutions over this infrastructure layer.
A similar and additional $1.7Bn (~₹15Bn) fund has also been set up for animal husbandry farmers as well.
India is a fairly agriculture dominated country. And despite agricultural output’s share in the economy reducing over the past few decades, owing to rapid technological advancements, agriculture is still one of the most crucial pillars of the Indian economy. Despite that importance though, India has categorically suffered from a lack of adequate and well-maintained agricultural infrastructure.
Be it cold chain storage or general storage, the condition of most such agri infrastructure pieces has been dismal. That gap in infrastructure development has reflected upon logistics as well, with supply chains marred by brokers, middlemen, poor transport etc. Several agri tech startups have tried to solve the logistics and supply chain side of things, but have achieved little success since the infrastructure side of things remains in its bad shape.