Status of Farm Mechanization in India

The PPT covers status of farm mechanisation in India along with global markets and various aspects related to farm machinery in India.

1. Status of Farm Mechanisation in India Prepared By: Sushant Chandra PGDMA-1947 ICAR-NAARM

2. Content Farm Mechanisation Global Scenario National Scenario Key Players FaaS Policies Recommendations

3. What is Farm Mechanisation? According to FAO “ Farm mechanisation is the process of improving farm labour productivity through the use of agricultural machinery, implements and tools. It involves the provision and use of all power sources and mechanical assistance to agriculture, from simple hand tools, to animal draught power and to mechanical power technologies. ” http://www.fao.org/tc/exact/sustainable-agriculture-platform-pilot-website/energy-management/mechanization/en/ Farm Power Availability (kW/ha) = {(Number of agricultural Worker × 0.05) + (Number of draught animal × 0.38) + (Number of Tractors × 26.1) + (Number of Power tillers × 5.6) + (Number of electric motor ×3.7) + (Number of diesel engine × 5.6)} / Available cultivated land in ha.

4. Need for Farm Mechanisation Increases Agricultural Productivity Less labour intensive Fast operation Better income Better crop intensity Precision Farming

5. Global Scenario Of Farm Machinery Market Farm Machinery Market USD 200 Billion (FY19) Predicted CAGR of 9% (FY19-25) Largest Markets Europe, Asia-Pacific & North America Europe holds 30% of global market share Tractors constitutes largest share (55%) Mechanization: Key to higher productivity to double farmer’s income, FICCI 2017; industry reports and PwC analysis

6. Current status of mechanisation vs contribution of agriculture to GDP World Bank Open data 2019, FederUnacoma, PwC analysis

7. Global Scenario Of Farm Machinery Market Market Segmentation of Global Farm Equipment Market FICCI PwC Knowledge Paper 2019

8. Forecasted Market Size Current and forecasted market size of global and Indian farm equipment market at 9% CAGR and 6% CAGR respectively (in USD billion) FICCI PwC Knowledge Paper 2019

9. Key features and growth rate of tractor industry worldwide in FY19 Percentage change in volume compared to FY18 World Bank Open data 2019, FederUnacoma, PwC analysis

10. Global Trade of Farm Equipment FICCI PwC Knowledge Paper 2019

11. Global exports of farming equipment in FY19 FICCI PwC Knowledge Paper 2019

12. National Scenario Indian farm equipment market is worth USD 13 Billion Likely to grow at CAGR of 6% Reaching USD 18 Billion by 2025 Overall mechanisation level 40% Largest in global production (1/3) Organised market size (8 lakh tractors) Highly unorganised market of threshers Market share of tractors is 81.4% Holds 35% of global volume of tractors

13. National Scenario Segmentation of market share of tractors based on HP capacity for India (FY17)

14. Farm power availability state wise More than 2.025 kW/ha Between 1.726-1.00 kW/ha Between 2.025-1.726kW/ha Less than 1 kW/ha Assessment of SMAM WAPCOS & MoAFW,2018

15. Farm power availability vs food grain productivity Assessment of SMAM WAPCOS & MoAFW,2018

16. Correlation between farm power availability and crop yield in India FederUnacoma (2019), MoA&FW, Mechanisation and Technology Department *Targeted plan to achieve in 2030

17. Agriculture value chain and types of equipment required

18. Crop-wise and region-wise adoption of mechanisation FICCI PwC Knowledge Paper 2019

19. Distribution channels for farm equipment OEMs Dealer’s Network Customer Retail

20. India as exporter Of Farm Equipment Total trade value of USD 131 million Grew at CAGR of 6% (FY11-19) India exported 92,095 units of tractors (FY19) Exports of combine harvesters grew at a CAGR of 15% (FY14-18) Major export destinations Sectoral Paper on Farm mechanization-NABARD, Dec 2018

21. Key Players Kotak Institutional Equities

22. Farming as a Service: Making services affordable to small and marginal farmers Located in radius of 50 Kms 40,000 CHCS More than 1,20,000 equipments Increasing income Availability of equipments CHC AGRI Machinery

23. Farming as a Service: Making services affordable to small and marginal farmers Platform For Agri Equipment Scheduling And Monitoring Customisation Lead to 25% improvement in ROI 20% reduction in field team required Uber for farm equipment' platform Gold Farm

24. Farming as a Service: Making services affordable to small and marginal farmers 300 Centres in Rajasthan Operations in Sugarcane with DCM Shriram in UP over 5 lakhs acre 100 centres in MP One centre has reach of 8-10 villages Reduction in time & cost EM3 Agri Services

25. Sub- Mission on Agricultural Mechanization(2014-15) National average of 2.02 kW/ha to 2.50 kW/ ha by 2022 and 4.0 kW/ha by 2030 Creating awareness among stakeholders through demonstration and capacity building activities. Disbursement of subsidy through state departments of agriculture for purchase and distribution of farm implements State departments of agriculture, farm machinery testing and training institutes (FMTTM),selected agricultural universities and ICAR Training, testing and demonstrations of farm machinery and equipment 05 01 02 03 04 Final report on Monitoring, Evaluation and Impact assessment of SMAM, M&T Division, MoA&FW, May 2018

26. National Food Security Mission (NFSM) Assistance (up to 50% the cost of machinery) to be provided for machinery such as pump sets, tractor mounted sprayers, seed drills, zero till seed drills to varying degrees. Assistance for large equipment (tractors, combine harvesters, sugarcane harvesters, cotton pickers, etc.) is available for establishing custom hiring centres (CHCs) Rashtriya Krishi Vikas Yojana (RKVY) 60% assistance from the Centre and 40% from the state Assistance is provided for procurement of power-operated machines and tools,besides for import of new machines. associations, farmer groups, SHGs, women farmer groups (with more than 10 members), etc., that are engaged in cultivation of horticulture crops . Mission for Integrated Development of Horticulture (MIDH) 60% assistance from the Centre and 40% from the state 60% assistance from the Centre and 40% from the state Other Policies

27. Improving access to finance Recommendations Upgrading skills Future ready Farm mechanisation Forging PPP models Efficient scheme implementation and delivery mechanism