Agriculture plays a vital role in India's economy. At 157.35 million hectares, India holds the second largest agricultural land in the world, according to the India Brand Equity Foundation. India also has an advantage by having all 15 major climates in the world, creating diverse environments for a plethora of crops and animal production within the country. India is the largest producer of spices, pulses, milk, tea, cashew, and jute, and the second largest producer of wheat, rice, fruits & vegetables, sugarcane, cotton, and oilseeds.
Around 60% rural Indian households make their living from agriculture, Inc42 reports. According to India's Department of Industrial Policy and Promotion, agricultural services and agricultural machinery sectors have cumulatively attracted foreign direct equity inflow of about US$ 2.45 billion. From April 2000 to June 2017, the food processing sector attracted another US $7.81 billion. India's Prime Minister Modi's government aims to double the average farmer's income by 2022, which gives even more incentive to join the industry for smallholder farmers. But the smallholder farmer faces costly and untimely financing, expensive and low quality agriculture inputs, basic legacy harvesting techniques, and an opaque supply chain to market, leading to market linkage issues. These factors translate to the Indian smallholder farmer being one of the few business entities in the world that buys at retail prices and sells at wholesale prices – inverting the fundamental economic model leading to consistent net losses and eventually debt traps.
There are companies working to change this model. For example, Jai Kisan intends to provide seamless, comprehensive, and end-to-end solutions to the fundamental problems facing the smallholder farmer. By facilitating cheap and timely capital, providing a greater variety of higher quality, less expensive agri-inputs, hand-holding farmers to increase yield; and increasing selling price through efficient market linkages, the company is trying to reverse the equation for smallholder farmers.