India Agriculture Market Size & Share Analysis - Growth Trends & Forecasts (2025 - 2030)

Agriculture Industry In India Market Trends and Insights

Government Support Through Subsidies and Policies

The Union Budget 2025-26 increased the Kisan Credit Card limit to Rs 5 lakh, unlocking larger working capital lines for smallholders and easing input purchases at critical crop stages. Prime Minister Dhan-Dhaanya Krishi Yojana channels resources to 100 low-productivity districts, bundling irrigation, precision farming training, and risk-mitigation tools. Minimum support price adjustments for 2024-25 favor oilseeds such as nigerseed and sesamum, encouraging diversification into high-value crops. Input subsidies, which account for 73% of the agriculture budget, reduce fertilizer and energy costs, creating a positive cycle of investment, productivity, and rural consumption.

Rising Adoption of Agri-tech and Mechanization

A Rs 6,000 crore allocation for digital agriculture infrastructure is funding AI-based crop surveys, drone-enabled nutrient mapping, and app-based credit scoring, helping farmers access formal loans within 24 hours. National mechanization now stands at 47%; Punjab and Haryana exceed 40-45%, while northeastern states remain largely manual, revealing significant headroom for expansion. The farm machinery market is forecast to grow from USD 16.73 billion in 2024 to USD 25.15 billion by 2029, driven by labor scarcity and better cash flows. Precision tools can boost yields by 30% and cut water and fertilizer use by 15-20%, improving profitability and resource efficiency.

Growing Demand for Organic and Sustainable Farming

Urban consumers are fueling a projected 25.25% CAGR for certified organic products through 2027, rewarding farms that adopt pesticide-free practices and traceability systems. Carbon-credit programs in eight states have issued the country’s first farm-generated credits, delivering a new income stream for regenerative growers^{[3]Source: Indian Brand Equity Foundation, “Agricultural Export Performance,” ibef.org}. Policy support for natural farming is deepening, with budget incentives for bio-inputs and AI-guided nutrient applications that protect soil microbiomes. Community seed banks preserve climate-resilient indigenous varieties, diversifying genetic resources while reinforcing farmer rights.

Expanding Export Demand via New Trade Agreements

Agricultural exports climbed 6.5% year-on-year to USD 37.5 billion for April-December 2024, defying global volatility. The Foreign Trade Policy 2024 promotes USD 2 trillion total exports by 2030, positioning agri-produce as a flagship contributor through simplified digital documentation and warehousing corridors. Spices recorded 51.01% growth, and coffee showed 40.3% growth in March 2024 shipments, aided by targeted quality and branding programs. Collaboration with Israel on water-efficient farming and tactical rice exports to food-insecure nations demonstrates the sector’s agility in balancing domestic needs with global opportunities.

Fragmented Landholdings and Declining Soil Fertility

Small and marginal farms now cover 85% of holdings, with average size falling below 2 hectares, making mechanization and scale efficiencies difficult without shared-service models. Fertility imbalances persist, with excess nitrogen and insufficient phosphorus-potassium inputs weakening soil structure and raising greenhouse-gas emissions. The Soil Health Card Scheme has expanded sampling, yet state-level adoption of balanced nutrient application remains uneven. Custom Hiring Centers that rent tractors and harvesters mitigate fragmentation constraints, though coverage gaps underline the need for expanded service networks.

Inadequate Cold-Chain and Storage Infrastructure

India loses 40% of fresh produce annually, about 40 million tons worth USD 13 billion because only 4% of perishables move through integrated cold chains. Operating costs for cold stores exceed Western norms due to high energy tariffs, limiting smallholder access. The Government plans to invest USD 15 billion over five years, prioritizing renewable-powered facilities and refrigerated container fleets that could cut losses by up to 35%. Roughly 20,000 refrigerated containers valued at USD 0.53 billion are required to match supply with horticulture output, signaling a sizeable opportunity for logistics providers.

Segment Analysis

By Commodity Type: Cereals and Grains Accelerate, While Fruits and Vegetables Show Growth Potential

Cereals and grains controlled 49.50% of the India agriculture market in 2024. The India agriculture market size for cereals is projected to advance steadily at the sector’s average CAGR, helped by expanded irrigation and mechanized harvesting. Pulses and oilseeds remain vulnerable to yield fluctuations, prompting a Mission for Aatmanirbharta in Pulses to foster self-sufficiency. Targeted subsidies, climate-resilient varieties, and integrated pest-management programmes are projected to stabilize these sub-segments over the forecast horizon.

Fruits and vegetables form the fastest-growing slice of the India agriculture market, projected to clock a 7.80% CAGR through 2030 as urban diets diversify and export orders climb. Horticulture output rose to 355.2 million tons in 2023-24, including 112.62 million tons of fruit and 204.96 million tons of vegetables. Targeted subsidies, climate-resilient varieties, and integrated pest-management programmes are projected to stabilize these sub-segments over the forecast horizon.

Note: Segment share of all individual segments available upon report purchase

Geography Analysis

Regional disparities shape the Indian agriculture market, with mechanization, water availability, and market linkages varying sharply across states. Punjab and Haryana post-mechanization rates above 40%, boosting labor productivity and underpinning large grain surpluses for the national buffer stock. In contrast, northeastern states remain largely manual, which constrains the adoption of precision farming and limits the flow of agritech finance. Gujarat leads in total factor productivity thanks to robust extension services, high micro-irrigation coverage, and export-oriented horticulture clusters. Bihar lags despite policy attention, highlighting the complexity of translating subsidies into field-level gains.

Commodity specialization further differentiates state performance. Andhra Pradesh dominates mango and banana output, Maharashtra anchors premium Alphonso mango exports, Gujarat excels in Kesar mangoes, and Karnataka commands pomegranate shipments. Cotton cultivation is concentrated in Gujarat, Maharashtra, and Telangana, together accounting for roughly 65% of the national supply; weather shocks in these states wield disproportionate influence on textile input costs. The Government’s creation of a Makhana Board in Bihar and the commissioning of a new urea plant in Assam illustrate region-specific industrial policy that targets comparative advantages and addresses input shortages.

Climate variability adds another spatial layer: the Indian Meteorological Department projects an above-normal 2025 monsoon with 105% of the long-period average, which should lift kharif sowing in rain-fed belts. Yet unseasonal rainfall damaged rabi crops in Maharashtra, prompting compensation demands of Rs 50,000 per hectare and spotlighting the need for parametric insurance. Digital weather advisories, drought-resistant seed distribution, and decentralized storage hubs are emerging as essential tools to smooth regional volatility and narrow yield gaps within the India agriculture market.