In recent years, the transformative impact of technology on Indian agriculture has reached a tipping point and investor interest in Agritech is at an all-time high. However, virtually all current startup activity and venture investments in Agritech are focused on digital technologies, e-commerce, full-stack farmer platforms, rural fintech, and marketplaces. Innovations in the life sciences of the agri-food industry are still severely neglected by venture capitalists and even entrepreneurs. Every technological revolution at some point in its development is faced with severe limiting factors that prevent the technology from reaching its full potential. The technology historian Thomas Hughes called these limiting factors “reverse salients”. We believe that the life sciences in the agri-food industry are the opposite in Indian agro-technology and will ultimately hold the transformation of Indian agriculture and food systems until it is addressed.
We regard life sciences in the agri-food sector as four broad categories: agro-biotechnology, novel cultivation systems, bioenergy and biomaterials, and innovative foods. Ag Biotechnology encompasses in-house inputs to plant and animal breeding, including genetics, microbiome, breeding and animal health. Novel farming systems include indoor farming, RAS aquaculture, insect protein, and algae production. Bioenergy and biomaterials include the processing of agricultural waste, the production of biomaterials and raw material technology. Finally, innovative foods refer to various forms of alternative proteins (plant-based, fermented, and cell-based), functional foods, and other novel ingredients. Globally, in 2020, $ 6 billion was invested in life sciences startups in the agri-food sector, while their Indian competitors raised just over $ 10 million in total. India is emerging as a global outlier, with the US, Israel, Europe, and China all building unicorn startups in the agri-food life sciences.
The lackluster state of entrepreneurship in the agri-food life sciences is counter-intuitive considering how critical innovations in synthetic biology, chemistry and biotechnology are to the future of Indian agriculture and food systems. Within a decade, Indian farmers will be bearing the full brunt of climate change, and digital technologies alone will not be enough to ensure a bright future in rural India. Innovations in the life sciences of the agri-food industry can play a crucial role in tackling climate change (reducing India’s greenhouse gas emissions) and climate adaptation / resilience (securing a future for India’s farmers). Life sciences in the agri-food industry will also create opportunities to completely reinvent agricultural value chains. India’s abundance of millet and legumes can be converted into innovative plant-based proteins to meet global needs.
Unsustainable feed ingredients for animals and aquaculture such as fish meal can be replaced with insect proteins, creating a circular economy on a large scale. Eventually, biological substitutes for traditional chemical fertilizers and pesticides can be developed that will improve human and planet health at the same time. The challenges ahead are myriad, but the agri-food life sciences in India can meet them with truly groundbreaking solutions.
The root cause of the dying state of the Indian agricultural and nutritional science ecosystem is confusing. Many blame India’s de facto ban on new transgenic properties in seeds, but this can hardly explain the lack of start-ups in the fields of biological plant matter, microbial biotechnology, cellular alternative protein and animal / aquaculture health products. If regulatory challenges cannot explain the lack of vibrancy in India’s life sciences ecosystem, it may be a lack of talent. Ultimately, India’s digital startup ecosystem was built by global entrepreneurs and investors, many of whom had trained and / or worked overseas, including in Silicon Valley. In contrast, life science talents in India migrate overseas at the earliest possible opportunity and rarely return home. However, with one-sixth of humanity backed by strong universities and research institutions, India certainly has enough indigenous life science innovators to start building a living ecosystem.
So if the lack of life science entrepreneurship in the agri-food sector cannot be attributed to government policies or a lack of local talent, perhaps the challenge lies in the availability of capital. If you look at Indian startup funding, in the past it has ignored deep tech and hardware in favor of lower hanging fruits like e-commerce and fintech. This is in part because venture capital goes where it sees the greatest and easiest possible opportunities. However, part of this could be because most venture capitalists in India have a digital technology background and were not trained in life sciences. This is not the case worldwide where life science VCs are their own kind, mostly with PhDs and significant prior work experience in life science startups or in the pharmaceutical and biotechnology sectors of companies.
India’s agrifood life science ecosystem needs to be restarted, filled with talent and catalyzed with capital. Rebooting means taking stock of what is currently working and what is not. The public sector has done more here than anyone would have thought it could. DBT, BIRAC, C-CAMP and NCL help support life sciences entrepreneurs without significant private investments. But startups in the bio and life sciences in the agri-food sector are still grappling terribly with the lack of wet laboratories and other critical infrastructures for synthetic biology. Universities and institutes (including CSIR and ICAR) rarely commercialize their intellectual property, categorically reject exclusive technology licenses, and have failed to foster entrepreneurship among their professors, graduate students, and researchers.
After two decades of anemic advances, a new approach is needed to accelerate life sciences in the agri-food industry in India. Whether developed by accelerators or research institutes, the infrastructure for research and development in the life sciences must be made available to entrepreneurs. Life science talent in the NRI community should be actively recruited to return to India and build the ecosystem here as founders and senior leaders. After all, venture investors at every stage need to drive funding to turn these dreams into our new reality. We are under no illusions that the road to life sciences for Indian agri-food sciences will be easy. It will be a steep road for entrepreneurs, academics, venture capitalists and policy makers alike. But the future of Indian agriculture and food systems depends on the choices we make today.
This column first appeared in the print edition on December 15, 2021 under the title “Sowing the next revolution”. Kahn is the managing partner of Omnivore, Ramachandran writes on agribusiness matters, and Diwan is the co-founder and CEO of BioPrime.
