Agricultural Mechanization (beyond tractors) – focusing on the Indian Agri-Machinery Industry

EAC has observed key trends shaping today’s Indian agri-machinery industry. The key trends are:

Small agri-machinery segment transitioning towards localisation:

The small agri-machinery segment is dominated by cheap machinery imported from China that lacks reliability and after-sales service assistance. The sector is going through a strategic change, with an increasing emphasis on lowering reliance on imports and increasing the manufacturing of high-quality products locally. Several existing Indian players within the small agri-equipment sector are investing in local manufacturing capabilities to cater to the domestic market via their strong distribution network spread across the nation and exports to neighbouring countries, while other players focus on increasing their contract manufacturing revenue share to utilise their installed capacities.

Precision Farming with Robotic Sprayers for crop protection:

In India, precision farming is witnessing a transformative shift with the integration of robotic sprayers for crop protection. Farmers in certain parts of India are gradually shifting towards these advanced systems due to their precise and automated application of pesticides and fertilizers, which results in minimizing waste and optimizing resource utilization. With real-time monitoring and data analysis, farmers are able to enhance efficiency, reduce environmental impact, and achieve higher crop yields.

Agri-machinery contracting – emerging as a side business:

Low margins in crop production are forcing farmers (the end-user segment) to search for additional revenue sources. Renting out agri machines or undertaking contracts for farming operations across the value chain is emerging as a good side business opportunity for the farmers. The agricultural workforce is migrating to urban areas as a result of urbanisation, which has led to a severe manpower shortage and raised wages for agricultural work. It is driving demand for machines on rent as it is a cheaper and more efficient way than hiring a labourer for the same task or owning an agricultural machine for personal use.

Post-harvest residue management machineries gaining traction

The growing significance of biomass management in agriculture is driven by the increasing emphasis on biofuel production. Government targets, particularly the aim to achieve a 20% bioethanol blending in petrol by 2025–26, are driving a surge in demand for advanced post-harvest machinery. This includes equipment such as combine harvesters and balers, which are instrumental in efficient residue management. The stringent regulations on residue burning further amplify the need for post-harvest machinery solutions.

These trends collectively underscore the industry's resilience and adaptability to technological advancements, and the imperative for sustainable agricultural practices. As the sector continues to evolve, embracing these opportunities beyond tractors positions local as well as multi-national stakeholders strategically in the dynamic landscape of the Indian agri-machinery industry.

EAC has significant experience in supporting global agri-machinery companies in aligning their go-to-market and growth strategies as per Indian agri-machinery industry requirements. You may connect with the EAC team in India to develop a customised strategy to suit your requirements.

Summary: India's agricultural industry is undergoing a transformative shift, moving beyond traditional tractor dominance. Key trends include the localization of small agri-machinery, adoption of precision farming with robotic sprayers, emergence of agri-machinery contracting, and escalating demand for post-harvest machinery driven by biofuel goals and stringent regulations on residue burning.

If you are seeking further guidance please connect to our expert Mr. Ketan Jadhav, Partner at EAC.