How Drones Can Boost India’s Agriculture Industry

India is a global agricultural powerhouse, and agriculture is a primary source of livelihood for more than 50% of India’s population. According to the World Bank, India is the largest producer of pulses and spices, and the second largest producer of rice, wheat, cotton, sugarcane, fruit, vegetables, and tea. It has 1.95 lakh sq km of land used for cultivation out of which 63% is rain-fed and 37% is irrigated. 

The Government of India (GOI) has exempted agricultural income earned by the taxpayer from tax. Furthermore, to boost the agriculture economy, subsidies are provided for fertiliser, irrigation, power, export, credit, agriculture equipment, and infrastructure. 

GOI is playing an active role in upgrading technology usage in agriculture. In Q1 FY22, GOI updated regulations on the usage of agriculture drones. GOI released a certification scheme for drones to promote agriculture spraying via drones. It offered a 100% subsidy or INR 1 million to Farm Machinery Training Institutes, Krishi Vigyan Kendra, Central Island Agricultural Research Institute, and agriculture universities. 

Furthermore, INR 6,000/ hectare contingency fund will be provided for sourcing drones from custom hiring centres.

Growth Drivers

• Improvise the yield rates and protect the farm worker from adverse effects of manual spraying of pesticides;
• Startup India, a GOI programme, can provide funding support to manufacture indigenous drones, which can fulfil the local farms' requirement, and decrease the price of drone usage when compared to ones developed abroad; 
• Application of drones in agriculture will provide employment opportunities, especially in small towns and rural areas.

Growth Restraints

• Lack of technology awareness among the farms with regards to the usage of drones in agriculture;
• Most farmers in India hold a limited size of land, which leads to an increase in the cost of drone operation.

According to Frost and Sullivan, drone usage in India within the agriculture market will grow at 38.5% CAGR and reach $121.43 million by 2030 and the adoption rate of drones will be 2% of the total agriculture machinery spending. 

Spraying operations have more than 50% of the total market share. It will further improvise as pesticide regulations developed by the DGCA (Directorate General of Civil Aviation) get upgraded. Sensing and imaging have shown promising results in increasing productivity and crop yield, especially in specialty crops and fruit farms. Large agricultural corporations and plantations will adopt sensing operations earlier than average farmers of India. 

Sowing applications will remain low due to tough competition for cheaper availability of labour. Sowing has limited usage in one type of crop only, such as paddy, whereas seeding is difficult and dangerous. 

By 2028, with the upgrade in technology and government regulations, post-harvest transport of heavy crops such as cabbage and cauliflower along with similar applications in hilly regions is expected to be witnessed. 

Drones that weigh less than 5 kg are more likely to be adopted as they are best suited for imaging operations. In the next three to five years, with BVLOS (Beyond Visual Line of Sight) permission, subsidies and incentives will drive heavier drones weighing 5-25 kg (with 10L payload) for spraying operations. 

It will see a sharp increase after 2025, when spraying regulations will provide better clarity. Drones that weigh 25-150 kg are expensive compared to micro and, small drones. Therefore, they are preferred over heavier drones. However, heavier drones will be restricted to larger farms and hilly terrain. Drones above 150 kg may see transport-based operations in future, post 2029.

Conclusion

Looking at the size of the country and the push from the government, start-ups within the drone ecosystem have mushroomed. The agriculture market is expected to be disrupted by the technological advancement and manufacturing of low-cost indigenous agriculture drones. 

Many start-ups are now able to get decent funding from the private equity (PE)/ venture capitalist (VC) as they feel it is the right time to invest in the emerging technology and grow with time. This will aid the increasing adoption of drones in the agricultural sector, which will increase the crop yield and income for farmers and help in creating employment opportunities.

Since the drone industry in India is in a nascent stage, a consistent push from the government is required for the industry to flourish – by educating farms, providing subsidies, and tax rebates. On the other hand, the private players need to work closely with the government to develop the regulations, which create a favourable environment for the development of the drone industry. 

Drone pilot training, schools should be opened both in the urban and rural areas, which help in providing the trained manpower to the drone service providers. India is a low-cost powerhouse in the world; manufacturing indigenous drones can not only improve the life of the Indian farmers but also improve the lives of the farmers of underdeveloped nations by sharing knowledge and technology transfer.

About the Author: Waseem Ahmed Khan is an Industry Analyst, Aerospace & Defense Practice at Frost & Sullivan. He has over eight years of work experience in syndicate and custom research assignments, with specific expertise in business analysis, competitive intelligence, strategic marketing, technology scouting and trend analysis. He has an MBA degree in Aviation Management from University of Petroleum & Energy Studies and a BE degree in Mechanical Engineering from the University of Rajasthan. He has in the past worked for ITeS, Market Research, and Consulting companies like FutureBridge, Genpact (GE Aviation Process) and Infiniti Research.

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