Here’s how agritech sector reacted to Union Budget 2022
Finance Minister Nirmala Sitharaman made a slew of announcements for India’s agricultural sector while presenting the Union Budget for the financial year (FY) 2022-23. The Centre will promote Kisan Drones, chemical-free natural farming, public-private partnerships for the delivery of digital and high-tech services to farmers across the country during the financial year 2022-23,
The government will also facilitate a fund with blended capital raised under the co-investment model through Nabard to finance agri start-ups and rural enterprises, she said. The fund will be used to finance startups for agriculture and rural enterprises, relevant to the farm produce value chain.
“This is to finance start-ups for agriculture and rural enterprise relevant for farm produce value chain,” the finance minister said.
The activities of these start-ups will include inter-area support for farmer-producer organisations (FPOs), machineries for farmers on a rental basis at the farm level and technology including invitee base, she added.
Here are the post-budget reactions from agritech industry
Mr. Siraj Chaudhry, MD & CEO, NCML
The budget has made a sincere attempt to promote the use of technology in Agriculture and make it future-ready. The last mile digital connectivity has the potential to drastically alter the Agri landscape of the country and by announcing the completion date of the Bharat Net project by 2025, the budget has attempted to bridge the digital divide between the villages and urban areas by 2025. Steps like the provision of funds through NABARD for Agri start-ups and rural enterprises will help in infusing capital in the budding ecosystem of value chain start-ups along with ensuring delivery of digital and hi-tech services to farmers and stakeholders of Agri value chains. With the availability of cheaper funds, these value chain start-ups will be able to widen their reach and help in providing much-needed technical support to farmers. Emphasis on the use of Kisan drones for crop assessments, digitization of land records are welcome steps and would help companies involved in the gathering of crop and weather data.
The announcement of a domestic scheme to reduce dependence on oilseed imports seems to be in line with the previously announced National Mission on Edible Oils – Oil Palm with a financial outlay of Rs.11,040 crores for reducing the edible oil imports. There is a real need to align the academic research in Agriculture with the market and the proposed reforms in the syllabi of Agricultural universities to align it with the needs of modern-day agriculture has been a long-standing demand of the Agriculture sector which finally seems to be fulfilled.
The budget proposes to phase out a large number of exemptions applicable on some Agri products, chemicals, drugs. Though the fine print is still awaited this decision might have an inflationary effect on Agri nutrients, agrochemicals and pesticides which could further stoke food inflation.
Mr. Prasanna Rao, MD & Co-founder, Arya.ag
The Union Budget has set the ball rolling for the agritech sector in the country. The special focus around the post-harvest considerations related to millet farming is a welcome step and will help enhance the country’s farm produce quotient. The Budget has also placed agritech in the right limelight with the Finance Minister reposing faith on the role of these new age players to transform the agriculture sector in the country under the PPP mode. Furthermore, Finance Minister’s assurance on government support to FPOs and small farmers to procure farming equipment as well as gain access to technology-led capabilities and services is also in the right direction. Overall the intent to inculcate a strong element of digitization in form of Kisan drones for crop assessment, in the agri value chain, will leapfrog India’s place in the global agriculture landscape. Pertaining to start-ups, the move to extend the tax incentive scheme till March, 2023 is encouraging and will benefit a large set of players.
Kishor Jha, CEO & Founder, Ergos, The Grainbank
Budget 2022 will be a game changer for the agriculture sector. The announcement underlined the Government’s focus to build a strong ecosystem to empower the farmers. Installation of optical fibres across rural hinterlands will not only bring uninterrupted access to digital services and ensure the best returns on their produce. The farmers will be able to move from farm-gate to the end buyer directly, efficiently and access small credit from the banks. The decision to transfer MSP directly into their bank accounts is laudable and ensures that services reach every individual farmer. It is time that fintech services should be made easily available to the farmers, this budget promises that. Furthermore, proposing a blended finance, co-investment model facilitated through NABARD to finance start-ups in agriculture and rural enterprises is bound to boost the impact made by Agritech companies, making it scalable and sustainable.
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Jinesh Shah, Managing Partner, Omnivore
“The Union Budget for 2022 is steering the country into a greener future. Acknowledging the impact of global warming, the rising cost of cultivation and concerns around human and planetary health, sustainable agriculture has been pushed to the centre stage. It is an important step towards climate-proofing Indian agriculture and securing the livelihoods of millions of smallholders in the country. A blended capital fund under NABARD is also interesting as it can provide the FPOs with much-needed assistance. Keeping up with the times, the government’s support for drone use in agriculture and stressing the role of startups in facilitating ‘drone shakti’ is a great leap forward for driving precision farming at scale. I congratulate the Hon. FM for delivering a balanced budget that addresses the current challenges in the economy.”
ReshaMandi- Mayank Tiwari, Founder, and CEO
“The budget today was focused on tech driven enhancement across sectors allowing for more robust growth in agriculture, MSME and manufacturing setup. The emphasis laid out on public private partnership on tech driven agriculture is a welcome note for most of the Agri tech startups. I am sure the budget will allow for more investments in terms of domestic investors and FDI across sectors in India to drive India@100 vision. It is also great to see the government’s continued focus on tech development, especially in the fields of Artificial Intelligence and Blockchain. It is truly the Amrit kaal for India.”
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