India Agricultural Tractor Market Size

India Agricultural Tractor Machinery Market Analysis

The India Agricultural Tractor Market size is estimated at USD 2.37 billion in 2024, and is expected to reach USD 3.13 billion by 2029, growing at a CAGR of 5.80% during the forecast period (2024-2029).

• The demand for agricultural machinery, including tractors, increased due to higher Kharif sowing, good cash flows to farmers, a timely and normal monsoon in the country across June and July 2022, continued higher rural spending by the government, and exemption from lockdown restrictions.
• Government initiatives toward rural development, farm mechanization, and various factors, such as high rural wages and scarcity of farm labor, will likely increase the tractor volume over the long term. In terms of units, India is one of the largest tractor markets globally, selling 600,000 to 700,000 tractors per annum on average between 2018-2021.
• Two-wheel-drive tractors are more popular than four-wheel-drive tractors in the Indian market. The agriculture tractor market is dominated by aboriginal Indian OEMs, namely Mahindra & Mahindra Limited, TAFE, International Tractors Ltd (Sonalika), and Escorts Limited. Key international tractor manufacturers like Deere & Company and CNH penetrated the market and established a decent market presence.
• India remains a highly lucrative tractor market because of the decreasing availability of farm labor and the rise of innovative business models, such as custom hiring solutions for tractors. In India, under the mechanization component of the macro-management scheme of agriculture by the Indian government, there is a subsidy for promoting agricultural mechanization, including 25% of the cost limited to INR 30,000 for buying tractors of up to 35 PTO HP. Thus, with the rising government support for enhancing farm mechanizations and expansion in crop production, the sale of agricultural tractors is anticipated to rise in the upcoming years.