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Agri exports from India is likely to reach US$ 60 billion by 2022. In FY20 (till January 2020) agriculture exports were US$ 28.93 billion.

Indian Agriculture Industry Analysis

    Last updated on Sep, 4 2020

India has the 10th-largest arable land resource in the world. With 20 agri-climatic regions, all the 15 major climates in the world exist in India. The country also has 46 of the 60 soil types in the world. India is the largest producer of spices, pulses, milk, tea, cashew, and jute, and the second largest producer of wheat, rice, fruits and vegetables, sugarcane, cotton, and oilseeds. Further, India is second in the global production of fruits and vegetables and is the largest producer of mango and banana. During 2019-20* crop year, food grain production was estimated to reach a record 295.67 million tonnes (MT). In 2020-21, Government of India is targeting food grain production of 298 MT.

Total area sown with kharif crops reached 88.21 million hectares by the end of July 2020.

Production of horticulture crops in India reached a record 320.5 million metric tonnes (MMT) in 2019-20 (as per second advance estimates), growing at a CAGR of 3.13 per cent during FY16-20. India has the largest livestock population of around 535.78 million, which translates to around 31 per cent of the world population. Milk production in the country is expected to increase to 208 MT in FY21 from 198 MT in FY20, registering a growth of 10 per cent y-o-y.

India can be among the top five exporters of agro-commodities by shifting its focus on cultivation and effectively handholding farmers, according to the World Trade Centre. Total agricultural export from India grew at a CAGR of 2.27 per cent during FY16-20 to reach US$ 35.09 billion in FY20. India's spices export increased by 23 per cent to Rs 2,690 crore (US$ 359 million) in June 2020 from Rs 2,190 crore (US$ 292 million) in the same month last year. The Agriculture Export Policy, 2018 aimed to increase India’s agricultural export to Rs 4,19,340 crore (US$ 60 billion) by 2022. Government aims to raise fishery export from India to Rs 1 lakh crore (US$ 14.31 billion) by 2024-25.

According to Department for Promotion of Industry and Internal Trade (DPIIT), Indian food processing industry attracted Foreign Direct Investment (FDI) equity inflow of about US$ 9.98 billion between April 2000 and March 2020.

Gross Value Added by agriculture, forestry, and fishing was estimated at Rs 19.48 lakh crore (US$ 276.37 billion) in FY20 (PE). Growth in Gross Value Added (GVA) by agriculture and allied sectors grew 4 per cent y-o-y in FY20.

The Electronic National Agriculture Market (e-NAM), launched in April 2016 to create a unified national market for agricultural commodities by networking existing Agriculture Produce Marketing Committees (APMCs), had 16.6 million farmers and 131,000 traders registered on its platform until May 2020. Over 1,000 mandis in India are already linked to e-NAM and 22,000 additional mandis are expected to be linked by 2021-22.

The Government of India has introduced several projects to assist the agriculture sector. Pradhan Mantri Gram Sinchai Yojana (PMGSY) aims to irrigate the field of every farmer and improve water use efficiency to achieve the motto, `Per Drop More Crop’. Overall, the scheme ensures improved access to irrigation. In the Union Budget 2019-20, the scheme was allocated Rs 3,949.90 crore (US$ 565.16 million). As per Union Budget 2020-21, Rs 2.83 lakh crore (US$ 40.06 billion) has been allocated to the Ministry of Agriculture and Rs 1,233 crore (US$ 176.42 million) has been allocated to the Ministry of Food Processing. PM-KUSUM scheme was expanded to provide 20 lakh farmers for setting up stand-alone solar pumps and help another 15 lakh farmers to solarise their grid-connected pump sets.

In June 2020, Government introduced Pradhan Mantri Formalization of Micro Food Processing Enterprises (PM-FME) scheme. It is expected to generate total investment of Rs 35,000 crore (US$ 4.97 billion), generate 9 lakh skilled and semi-skilled employment, and benefit 8 lakh units through access to information, training, better exposure, and formalization.

In May 2020, the Government announced the launch of animal husbandry infrastructure development fund of Rs 15,000 crore (US$ 2.13 billion).

Note: *- as per 3rd advance estimate

Indian Agriculture and Allied Industries Report (August, 2020)
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