Posted on May 3, 2016
Irrigation Sector is Poised to Boom by Government’s Allocation of Rs 17000 Crore This Year in the Budget
Irrigation sector is poised to boom by Govt’s allocation of Rs 17000 crore this year in the budget
“Rs.17, 000/- crore allocated for irrigation” and the nation rejoiced for its rural counterpart. We are a country whose 52 percent (approximately) of the workforce is engaged in agriculture and allied sector while they continue to contribute 13.7 Percent (approximately) to the Gross Domestic Product (GDP). These facts highlight the importance of agricultural produce and move our attention to its falling state. In order to aid the same, there has been a massive allocation of funds towards agricultural sectors, specifically irrigation.
In case, you are wondering why?
More than 60 percent of the total farm land in India is dependent on rains as a source of water and therefore monsoon season ends up being the master of the crop.
The availability of irrigation facilities in these lands would mean independence to farmers. If they can achieve the present numbers in such adverse conditions, imagine the additions when their produce is not subjected to such restrictions. Needless to say, economic development would follow.
How does it affect you?
Other than the obvious drop in food prices, there are numerous hidden opportunities behind that one move. Let us state one simple fact that might ease you into it, there is approximately 394.6 million acres of arable area in India. A simple calculation shows that there is still about 263.067 million acres of land waiting for irrigation facilities. The union budget this year has opened up doorways to a path that leads straight to this untapped market. Just through Pradhan Mantri Krishi Sichai Yojana (PMKSY), it has been promised that land up to 70.43 lakh acres will be covered.
The sentence, “Providing irrigation facilities” has a subtext that translates into needing resources that may make this dream a reality. There will be a wave of fresh demand and the winners will be the companies who are ready to supply. With just an announcement, the ministry and the government have converted rural areas into potential markets.
These are prospects for every company in the industry- may it be the big sharks who are dominating the market, the local penguins who are approachable in the market and the new- born who are learning to stand in the market.
How does this cycle work?
It would be a naïve assumption that the primary sector does not influence the secondary as well as the tertiary sector. Any new avenue, if opened up in agriculture and allied sector would result in a demand that can be satisfied by the manufacturing or industrial sector. In order to be able to do so, it would further require the help of service sector. Let us refer to the following process with the help of this figure:-
Is it really as simple as it sounds?
Yes and No. No, because new markets pose unknown threats and Yes because there are experienced players in the market to walk you through this process. Unlike urban areas, rural areas have a unique customer base. Unfortunately, most of the farmers in our country are uneducated and uninformed about the irrigation technology already prevalent in the market. This makes marketing your product a rather difficult activity. An inclusive strategy is required to be drafted with the help of agencies who have experience in these areas and can implement innovative idea on the ground to meet out your sales and marketing objectives.