Entrepreneurship in Agri Sector can make a Difference
With its impressive growth rate and emergence of a powerful services sector, India has transitioned its image into a new age economy over the past two decades. However, by and large, it still remains an agrarian country with 60 percent of its population still dependent on agriculture and allied activities. In recent years, with rapid urbanisation and decreasing income in agriculture, the need is to shift the rural population to other sources of income, by creating alternative avenues of work.
This entails creating more job opportunities in the manufacturing sector as well as developing innovative mechanisms in the rural economy to boost employment opportunities in the agri sector. This is where the role of entrepreneurship in agribusiness plays a major role. The success of cooperatives in India, particularly Gujarat’s dairy cooperative and Maharashtra’s sugar cooperative are examples of what innovation and entrepreneurial thinking can do for the rural sector.
In India, the agribusiness segment constitutes four sectors - agricultural inputs, agricultural production, agro-processing and marketing and trade. The country also has a large raw material base which is essential for food processing. Agribusiness has the capability to develop entrepreneurial skills among farmers. It is connected with processing, production, marketing, trade and distribution of raw and processed food, feed and fibre.
Entrepreneurship, not only helps to develop alternative sources of employment, but also to radicalise farming techniques and brings innovation to improve yields per hectare. Smart farming is the need of the hour. Biotechnology can be utilised in agriculture for benefits such as helping raise crops’ tolerance to insects, diseases and weeds, endowing crops with tolerance to abiotic stress such as salinity, drought and changes in temperature.
A number of self-employment opportunities can be generated in agriculture through the development of entrepreneurship skills. The sectors that can benefit hugely from entrepreneurial intervention are food processing and packaging, preservation of seasonal fruits and vegetables, seed processing, flower farming, crop farming etc.
Agro-based industries can flourish in rural sectors where labour is abundant and cost of labour is low. Small and medium enterprises can be set up at rural level to supplement traditional farm income in a big way and create alternative sources of income.
Let’s take a look at some points to gauge how entrepreneurship can help the agri sector:
• Improvement in Farm Technology: Dependence on outdated and inefficient technologies lead to poor productivity and low income. While large scale farmers have adopted modern technology on a major scale in India, most small farmers still rely on age-old farming techniques with mostly manual methods. Boosting entrepreneurial minds in agriculture can boost productivity by incorporating modern technologies in the farming sector.
• Food Processing: Agriculture-based industrial products account for half of all exports from developing countries. However, most of them involve exports of raw material as against developed countries whose exports mostly comprise processed goods. By continuing to operate at a low level of value chain, we are losing income and production. Moving up the value chain is extremely essential and boosting entrepreneurship in agriculture can make much of a difference. An entire food processing industry can be developed in rural areas, augmenting income and employment. For example, setting up jam manufacturing units in areas which produce fruits can ensure easy access of raw material as well as provide employment to the people.
• Flower Farming: In a number of cases, flower farming can be done on small tracts of land. In fact, bulks of flowers are cultivated on ‘micro farms’. Farmers can utilise a part of their land to cultivate seasonal flowers alongside regular food crops. But, this needs to have markets for flowers in the vicinity or processing and preservation units. Entrepreneurs having knowledge of flower cultivation and marketing can set up parallel industries in fertile rural lands.
• Fish Farming: Some rural folks do catch and sell fish to augment their incomes. However, they do fish farming on amateurish and individual basis. A conscious business effort to develop small pond fish farms in rural areas can enable pisciculture to become a valuable sector. Fish cultivation on market scale needs some knowledge, thus, boosting entrepreneurship in the sector can make a difference.
Time for Agricultural Start-ups
Today, India is emerging as the next big start-up nation. Unfortunately, the agricultural sector has remained out-of-ideas and out-of-mind. The country has a lot of scope for agriculture-related start-ups. However, lack of awareness about capital raising options and lack of enthusiasm amongst investors towards this sector are some issues plaguing the sector.
This situation can be changed by offering entrepreneurs tax benefits, easy loans and other incentives for establishing start-ups in rural belts. Developing entrepreneurs in agriculture can immensely benefit Indian economy by:
• Reducing the burden on agriculture;
• Generating employment opportunities for rural youth;
• Reducing the need for migration from rural to urban areas, thereby reducing pressure on urban cities etc;
• Increasing individual and national income.
Entrepreneurship in agri sector is not only an opportunity, but also a necessity for improving the production and profitability.
About Author: Rajesh Aggarwal is Managing Director at Insecticides India Ltd..